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The Big Daddy of business software, Oracle ( ORCL ) made it four consecutive quarters of shrinking year-over-year earnings, but the company posted a big increase in its cloud software and shares rose after-hours despite a slight revenue miss. For fiscal Q3 ended Feb. 29, the company late Tuesday said earnings per share minus items fell 5.9% from the year-earlier quarter to 64 cents. That nevertheless beat the 62-cent consensus estimate of analysts polled by Thomson Reuters. And Oracle stock was up 4% in after-hours trading, after its earnings release. Revenue fell 3% to $9.01 billion, where analysts had modeled $9.13 billion. Cloud software revenue, however, jumped 40% to $735 million, and would have been up 44% in constant currency. Oracle does a lot of its business outside the U.S., so it’s hurt more than most by the strong U.S. dollar. Oracle said its software-as-a-service and platform-as-a-service revenue jumped 57%. The third cloud software component, infrastructure-as-a-service, fell 2%. The legacy software developer is transitioning more of its business to the cloud, while still managing billions of dollars in traditional, on-premise enterprise software license sales, making for an often rocky transition. “Our Cloud SaaS and PaaS revenue growth rate accelerated to 61% in constant currency in Q3,” said Oracle co-CEO Safra Catz in the earnings release. “This dramatic revenue increase drove our non-GAAP SaaS and PaaS gross margins up to 51% in Q3 as compared with 43% in Q2. Our cloud business is now in a hyper-growth phase.” Oracle had closed up a fraction in Tuesday’s regular session. Rival Microsoft ( MSFT ), which does many things other than developing software, also rose a fraction and did enterprise software rival SAP ( SAP ), while cloud rival Salesforce.com ( CRM ) fell a fraction Tuesday. Scalper1 News
Scalper1 News