From housholder@ualfltctr.com Wed, 07 Mar 2001 15:57:44 -0800 From: Patrick Housholder Date: Wed, 07 Mar 2001 15:57:44 -0800 Subject: RE: Oracle Licensing Message-ID: MIME-Version: 1.0 Content-Type: text/plain ha, thank-god they save 1 billion dollars on using there own software. p- =============================== Patrick Housholder Sr. Staff Anl Tech Spt Design United Airlines Flight Training Center Denver CO *>-----Original Message----- *>From: root@fatcity.com [mailto:root@fatcity.com]On Behalf Of Eric D. *>Pierce *>Sent: Wednesday, March 07, 2001 11:07 AM *>To: Multiple recipients of list ORACLE-L *>Subject: RE: Oracle Licensing *> *> *> *>Oracle profit warning spells doom: *> *>http://www.zdnet.co.uk/news/2001/8/ns-21312.html *> *>---excerpt--- *> Lowered spending for software has hit Oracle *> where it hurts *> *> Oracle, the world's second largest software *> company, on Thursday joined the list of *> technology bellwethers warning that a slowing *> economy would cause profits to come in lower *> than expected. *> *> Oracle had been one of the few industry titans to *> appear unscathed by corporate America's *> reluctance to commit to big-ticket technology *> purchases. *> *> With Thursday's announcement after the close of *> trading, Oracle joined the growing list of high-tech *> companies, including Cisco Systems, Microsoft *> and Sun Microsystems -- that have issued profit *> warnings or indicated that deteriorating economic *> conditions likely will make for a difficult business *> climate during the first half of the calendar year. *> *> "We're seeing a very substantial slowdown in the *> US economy that is making people cautions in all *> of their spending, including spending for *> software," Oracle chairman and chief executive *> Larry Ellison said. *> *> Oracle said its formerly bullish forecasts began to *> crumble when senior executives in the United *> States were reluctant to give final approvals as *> Oracle pushed to close sales for its fiscal third *> quarter, which ended on Wednesday. *> *> "We didn't see a slowdown and that was *> consistent up until about last Friday," Oracle chief *> financial officer Jeff Henley said. *> *> "After that, every day it got worse. Literally the *> last day of the quarter we had a number of *> transactions that didn't happen," he said. *> *> Oracle shares, which had rallied $2-3/8 to close *> at $21-3/8, fell to a new year-low of $16.94 in *> after-hours trading on the Island system. The stock *> is well off its year-high of $46-7/16. *> *> Based on the slowing sales, Oracle now expects *> to report earnings per share at 10 cents, up 25 *> percent from 8 cents a year ago, excluding *> investment gains. The company had been expected *> to earn 12 cents a share, according to First *> Call/Thomson Financial. *> *> Ellison said Oracle's operating income would be *> about $900m, compared with Wall Street's *> forecast of $1bn. *> *> Oracle executives also said the company did not *> yet see evidence that sales were slowing in Japan, *> Asia and Europe. *> *> "Through the third quarter, at least, there didn't *> appear to be any leakage abroad, but that doesn't *> mean it couldn't happen," Henley said. *> *> "It's just going to bring down the whole software *> sector. Obviously, no one's immune. I think the *> whole group is vulnerable. This is the spill over *> of technology," Credit Suisse First Boston analyst *> Brent Thill said. "Software was the last standing *> soldier." *> *> The software vendor said total revenue grew *> around 9 percent for the quarter and software *> license sales revenue rose by 6 percent. Of the *> company's two software product lines, Oracle *> said its applications business of enterprise and *> front office software grew 50 percent while its *> database business was flat to slightly negative. *> Oracle is slated to give detailed fourth-quarter *> financial guidance when it reports third-quarter *> earnings on 15 March. *> *> In the months leading up to the warning, Oracle *> said applications revenue would increase by 75 *> percent or more in the third quarter. *> *> Analysts had been lowering forecasts for Oracle's *> database revenue -- which accounted for more *> than one-third of the company's second-quarter *> revenues -- citing a slowing economy and dot-com *> failures. Nevertheless, many thought it would *> grow by at least 10 percent. *> *> "I was expecting things to not be great. But I was *> not expecting it to be this bad. I still thought the *> database business would exhibit some growth," *> Epoch Partners senior analyst Mark Verbeck, said. *> *> While the warning marks the second time in a *> decade that Oracle's earnings are expected to miss *> forecasts, Ellison said the company's *> year-over-year profit and margins show *> improvement despite the tough economic *> atmosphere. *> *> Oracle's operating margin improved to 33 percent, *> an increase from 31 percent a year ago, said *> Ellison, who added that the company also will *> continue to manage expenses by allowing its head *> count to fall through natural attrition. *> *> "As long as the economy doesn't get worse, we *> think we're going to be just fine. We think we're *> better equipped to deal with the slowdown than *> any other company on earth," Ellison said. *> *> Analyst Thill, however, sees more disappointment *> to come. *> *> He said the software industry has been in a slump *> for the past six months but stock prices haven't *> bottomed out yet. *> *> Thill said he would not be surprised if shares of *> some software companies slide another 15 percent *> to 25 percent. *> *> "I don't know what's going to fix this," Verbeck *> said. *> *> "We're in this vicious circle where there's *> unprecedented interest by consumers in the stock *> market. Even though the numbers in the economy *> aren't bad, the sentiment is terrible. It becomes *> self-fulfilling. It's not good," he said. *> *>---end--- *> *>-- *>Please see the official ORACLE-L FAQ: http://www.orafaq.com *>-- *>Author: Eric D. Pierce *> INET: PierceED@csus.edu *> *>Fat City Network Services -- (858) 538-5051 FAX: (858) 538-5051 *>San Diego, California -- Public Internet access / Mailing Lists *>-------------------------------------------------------------------- *>To REMOVE yourself from this mailing list, send an E-Mail message *>to: ListGuru@fatcity.com (note EXACT spelling of 'ListGuru') and in *>the message BODY, include a line containing: UNSUB ORACLE-L *>(or the name of mailing list you want to be removed from). You may *>also send the HELP command for other information (like subscribing). -- Please see the official ORACLE-L FAQ: http://www.orafaq.com -- Author: Patrick Housholder INET: housholder@ualfltctr.com Fat City Network Services -- (858) 538-5051 FAX: (858) 538-5051 San Diego, California -- Public Internet access / Mailing Lists -------------------------------------------------------------------- To REMOVE yourself from this mailing list, send an E-Mail message to: ListGuru@fatcity.com (note EXACT spelling of 'ListGuru') and in the message BODY, include a line containing: UNSUB ORACLE-L (or the name of mailing list you want to be removed from). You may also send the HELP command for other information (like subscribing).