(FinancialPress) — Oracle is currently trading at $49.04 – a 3.76% dip from yesterday‘s $52.79. This comes after a Thursday spike when the company announced surprisingly good performance during the year‘s first quarter. Yet, that was quickly put on ice as it also announced that the third and last quarter of the year is expected to underperform against analysts‘ forecasts.
The Redwood City-based tech leader led with the good news – the company‘s total revenues went up 7%, reaching $9.2 billion. A considerable portion of that was led by its cloud business revenue, which rose 51% up to $1.5 billion. It also turned an adjusted profit of $0.62 per share.
Wall St. forecasts for the quarter were $9.02 billion in sales and earnings of $0.60 per share.
“The sustained hyper-growth in our multi-billion dollar cloud business continues to drive Oracle’s overall revenue and earnings higher and higher,” said Oracle CEO, Safra Catz. “In Q1, total revenues were up 7%, GAAP EPS was up 19%, and non-GAAP EPS was up 12%. Oracle is off to a very, very strong start in FY18.”
As for the less auspicious news, it was also announced that lagging growth in cloud software is likely to translate into smaller growth in the future. The 2nd quarter is expected to present revenue growth of 39 to 43% – considerably shy of the 1st quarter‘s 51%.
Oracle recently announced that, as preparation for a 5,000-strong hire wave for its cloud division, it would lay off hundreds of workers from the hardware unit in Santa Clara. They have been a relatively late entry to the cloud software market, which allows customers to defect from expensive on-site licenses in favor of cheaper, suscription-based licenses for software solutions delivered online through the cloud.
One of the major announcements coming from their headquarters this month was that it‘d tie executive bonuses to the company‘s ability to grow its cloud business revenue to $20 billion/year. They are currently at $4.57 billion/year.