Oracle aims at SaaS and cloud computing space
Some years ago, Oracle did not want to venture into the SaaS sector because there was the problme of high sales cost and also high implementation costs. But now, it seems Oracle is trying to get into SaaS and cloud computing space.
It is seen from the fact that last quarter, Oracle Sourcing On Demand was released for efficient supply chain management and now it is going to release its Fusion applications later this year. Oracle aims to be the leading leading on-premise and on-demand application company. At present its on-demand business is now worth about three quarters of a billion dollars, while the leading on-demand company, Salesforce.com’s annual revenue was $1.077 billion. The compnay also wants to address the missing factor of software hosted and stored at a data center owned by a customer but run by the software company which its rival does not address.
Taking a look at Oracle’s Balance Sheet, Oracle has $12.6 billion in cash and investments. During the quarter, it repurchased 14 million shares for a total of $250 million. For the full year, it repurchased 226 million shares for a total of nearly $4 billion. After the Sun acquisition in April, Oracle acquired Virtual Iron, a provider of server virtualization management software. SAP recently announced a $7 billion budget for acquisitions, perhaps in response to Oracle’s successful strategy of gaining market share.
For the first quarter, Oracle expects total non-GAAP revenue to range from zero to 2% in constant currency and negative 5% to negative 3% at current exchange rates. Non-GAAP EPS is expected to be between $0.31 to $0.33 in constant currency and from $0.29 to $0.31 at current exchange rates. GAAP EPS is expected to be between $0.23 to $0.24 in constant currency and $0.21 to $0.22 at current exchange rates.
The stock is currently trading around $21 with market cap of about $106 billion. It hit a 52-week low of $14.14 on March 6.
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