Oracle Corp. (ORCL) dropped the most in more than nine years in U.S. trading after it reported quarterly sales and profit that missed analysts’ estimates, hurt by slower demand for databases, applications and computer servers.
The second-largest software maker said profit before some costs in the fiscal second quarter ended Nov. 30 was 54 cents a share, on revenue excluding certain items of $8.81 billion, the company said in a statement yesterday. Analysts had projected profit of 57 cents on sales of $9.23 billion, the average of estimates compiled by Bloomberg.
Oracle, based in Redwood City, California, and other business-software companies are taking longer to close deals as companies gird for slow economic growth in the U.S. and the possibility of a recession in Europe next year, said Rick Sherlund, an analyst at Nomura Holdings Inc. New software licenses, an indicator of future revenue, rose less than Sherlund projected, and sales of hardware acquired through the Sun Microsystems deal fell more than expected.
“The economy got a little harder for them,” Pat Walravens, an analyst at JMP Securities in San Francisco, said in an interview on Bloomberg Television’s “Bloomberg West.”
“In that situation you need to manage your sales force a little more carefully. They were not doing that this quarter.” Walravens has a “market outperform” rating on Oracle shares.