Oracle Shares Down After A Weak Second Quarter

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Oracle Shares Down After A Weak Second Quarter

Oracle (ORCL) Shares Down by 8% After A Weak Second Quarter

The Oracle (ORCL) shares turned lower by 8% during Tuesday's session as the company's revenue during Q2 was below expectations.

As per the reports, Oracle's revenue during Q2 was lower than the forecasts. The company cited the difficult economic landscape as the main reason behind the revenue shortfall. In addition, Oracle is also facing tough competition from other cloud computing vendors, which is also making it difficult for the company to post strong results.

Oracle (ORCL) Posted $12.9 Billion Revenue

During the Q2, Oracle's revenue was around $12.9 billion, which is an increase of 5% YoY. However, the revenue was below the forecast of around $13.05 billion. Similarly, Oracle's EPS was $1.34, while the forecast was near $1.33.

Overall, Oracle's revenue from license support and cloud services jumped by 12% and was seen to be near $9.6 billion. On the contrary, the revenue from the on-premise license and cloud license turned lower by 18% and was seen near $1.2 billion.

According to the CEO of Oracle, the company is posting good growth in generative AI and could inflate the infrastructure sector. To add credibility to the claim, the CEO highlighted how the RPO has jumped to an astonishing value of $65 billion, which is more than the company's annual revenue.

The company also offered future guidance, which was mostly in line with the market forecast. Wall Street was expecting a growth figure of 8%, while the actual value from Oracle is around 6 - 8%.

According to Jefferies's analyst, the results for the recent quarter from Oracle were disappointing at best. They added that the company is facing an imbalance in supply and demand. However, Oracle has several big deals in the waiting that could change things up.

The analysts from the Evercore ISI also expressed their views by saying that the results for Q2 were mixed. They also highlighted that the results show that Oracle will experience growth acceleration during the next year (2024).

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