Oracle has earned a profit of $1.8 billion during the first quarter of 2017 and its decision to migrate to the cloud and away from on-premise systems continues to be a successful strategy.
The company highlighted the growth in its software as a service (SaaS) and platform as a service (PaaS) businesses. However its hardware and on-premise software businesses have continued to decline as the business model that brought Oracle to where it is today shifts to the cloud.
The company has reported revenues of $8.6 billion which are up two per cent from where they were at this time last year. The company has managed to take in a net income of $1.8 billion, which is up five per cent from this quarter last year. This is excellent news considering that the company's 2016 fiscal year saw its profits dip by 10 per cent.
Oracle's SaaS and PaaS services grew by 77 per cent during Q1 and its cloud business earned $969 million in revenue. The company's hardware revenues were just slightly higher at $996 million though they were down by 12 per cent on the quarter. Oracle's hardware product revenues fell by 19 per cent and its support revenues were down by 4 per cent.
The company's non-GAAP earnings per share were at 55 cents which is just short of the 59 cents that analysts had expected going into the quarter.
Oracle executives have continued to praise the growth of its cloud services division which was able to help offset its declining hardware sales. Though cloud is still a minor part of the company's total revenue stream at just 11 per cent this quarter, it remains its focal point going forward.
Mark Hurd, Oracle's co-CEO was eager regarding the company's SaaS and PaaS business, saying: “This year we are on track to sell more that $2 billion of SaaS and PaaS annually recurring revenue. We believe this will be the second year in a row that Oracle has sold more SaaS and PaaS than any cloud services provider.”
Image Credit: Josefkube / Shutterstock