(News Bulletin 247) – The publisher specializing in database management software delivered revenues and earnings per share that were too fair to satisfy investors. The stock fell in post-market trading.

The small, staggered wave of results on Wall Street gives rise to varying fortunes. Last week, customer relationship management software specialist Salesforce delighted investors, delivering growth above expectations. Which seemed to validate its shift towards generative artificial intelligence and conversational agents. The stock had gained nearly 11%.

Oracle faces a very different fate. The company specializing in database management software dropped 7.8% in post-market trading, after the publication of its accounts for the second quarter of 2024-2025 (i.e. from September to the end of November). This Tuesday, the stock lost 8.6% in pre-opening.

In the second quarter, Oracle generated revenue of $14.06 billion, up 9% at constant exchange rates year-over-year. Sales were supported by cloud computing services, with growth of 12% excluding currency effects over the quarter.

>> Access our exclusive graphic analyses, and gain insight into the Trading Portfolio

Cloud infrastructure leap

Oracle is seen as a major winner in the rise of generative artificial intelligence (AI) that has resulted in increased demand for the company’s cloud infrastructure.

This is reflected in the dynamism of this division, whose revenues jumped 52% year-on-year to $2.4 billion.

“Oracle Cloud Infrastructure powers many of the world’s most important generative AI models because we are faster and cheaper than other clouds,” Oracle Chairman Larry Ellison said in a statement. press release.

However, the company’s growth is not enough to meet high expectations. Analysts were therefore counting on slightly higher revenues than those published by Oracle, at $14.12 billion, according to a consensus cited by Stifel.

“These results, slightly below forecasts, disappoint given investors’ high expectations regarding technology stocks,” judges Invest Securities.

Disappointing RPOs

Furthermore, “remaining performance obligations” (RPO), i.e. the revenue expected from the future execution of contracts (or to simplify the order book) increased by 50% over one year to $97 billion. But Stifel notes that compared to the previous quarter, this key indicator of commercial dynamics lost $2 billion (RPO amounted to $99 billion in the first quarter). According to the bank, it is this indicator which, more particularly, caused the share’s plunge in post-market trading.

Earnings per share stood at $1.47 versus $1.48 expected by analysts.

For the third quarter of its 2024-2025 financial year, Oracle CEO Safra Catz said she expects growth of 7% to 9% in dollars while earnings per share should increase from 4% to 6%, or between $1.47 and $1.51. According to CNBC, these projections turn out to be quite significantly different from expectations, with the LSEG consensus being placed at $14.65 billion in revenue (compared to a mid-range of $14.3 billion, according to indications given by Oracle) and earnings per share of $1.57.

Despite the small stock market blow that is expected this Tuesday, Oracle shares remain up more than 80% over one year, driven by the impact of AI on its activity. “While Nvidia and Microsoft are the main drivers of AI, today we see many other big names in technology joining the AI ​​party, including Oracle, ServiceNow, Palantir, Salesforce, Dell, IBM, Apple and AMD,” judged Dan Ives of Wedbush in October.