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Oracle becomes the second largest cloud SAAS company

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Sharath Kumar
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NEW DELHI, INDIA:Oracle Corporation today announced that fiscal 2014 Q4 total revenues were up 3 per cent to $11.3 billion. Software and Cloud revenues were up 4 per cent to $8.9 billion.

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GAAP Cloud software-as-a-service (SaaS) and platform-as-a-service (PaaS) revenues were up 25 per cent to $322 million, while non-GAAP SaaS and PaaS revenues were up 23 per cent to $327 million. In addition, Cloud infrastructure-as-a-service (IaaS) revenues were up 13 per cent to $128 million. New software licenses revenues were unchanged at $3.8

billion. Software license updates and product support revenues were up 7 per cent to $4.7 billion. Overall hardware systems revenues were up 2 per cent to $1.5 billion with hardware systems products up 2 per cent to $870 million, and hardware systems support up 2 per cent to $596 million.

In Q4, both GAAP and non-GAAP earnings per share were lowered by $0.02 due to a non-operating loss caused by exchange rate changes in Venezuela. Furthermore, last year's Q4 GAAP earnings per share increased $0.04 because of a $269 million acquisition price reduction. As a result of these two factors, Q4 GAAP earnings per share were unchanged at $0.80 compared with last year, while GAAP net income was down 4 per cent to $3.6 billion, and GAAP operating income was down 2 per cent to $4.9 billion. Q4 GAAP operating margin was 43 per cent in the quarter. Non-GAAP earnings per share were up 6 per cent to $0.92, but would have been $0.94 if not for the currency loss in Venezuela. Non-GAAP

net income was up 2 per cent to $4.2 billion while non-GAAP operating income was up 3 per cent to $5.8 billion. The non-GAAP operating margin was 51 per cent . GAAP operating cash flow on a trailing twelve-month basis was $14.9 billion.

For fiscal year 2014, total revenues were up 3 per cent at $38.3 billion. GAAP Software and Cloud revenues were up 5 per cent . GAAP Cloud SaaS and PaaS revenues were up 23 per cent to $1.1 billion while Cloud IaaS revenues were $456 million. New software licenses revenues were unchanged at $9.4 billion while software license updates and product support revenues were up 6 per cent to $18.2 billion. Total hardware system revenues were flat at $5.4 billion. GAAP operating income was up 1 per cent to $14.8 billion, and GAAP operating margin was 39 per cent . Non-GAAP operating income was up 3 per cent to $18.1 billion, and non-GAAP operating margin was 47 per cent . GAAP net income was unchanged at $11.0 billion, while non-GAAP net income was up 2 per cent to $13.2 billion. GAAP earnings per share were $2.38, up 5 per cent compared to last year while non-GAAP earnings per share were $2.87, up 7 per cent .

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"Our cloud subscription business is now approaching a run rate of $2 billion a year," said Oracle President and CFO Safra Catz. "As our business has transitioned, more software revenues are being recognized over the life of a subscription rather than upfront. We're making this transition to cloud subscriptions and ratable revenue recognition while continuously increasing our top-line revenue and our bottom-line profits year-after-year."

"We have transformed Sun's commodity hardware business into a profitable and growing Engineered Systems business," said Oracle President Mark Hurd. "Our overall hardware business grew 2 per cent in constant currency this past year. We saw record levels of Engineered Systems shipments and expect to deliver our 10,000th unit in Q1."

"Oracle is now the second largest SaaS company in the world," said Oracle CEO Larry Ellison. "In SaaS, we're in front of everybody but salesforce.com. In IaaS we're larger and more profitable than Rackspace. We have by far the most complete portfolio of modern SaaS and PaaS products in the industry: CRM: Sales, Service & Marketing; HCM: HR, Payroll & Talent; ERP: Accounting, Procurement, Supply Chain & more. All these SaaS products run on the world's most powerful PaaS: the Oracle in-

memory multitenant database and Java. We plan to increase our focus on the Cloud and become number one in both the SaaS and the PaaS businesses."

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The Board of Directors declared a quarterly cash dividend of $0.12 per share of outstanding common stock. This dividend will be paid to stockholders of record as of the close of business on July 9, 2014, with a payment date of July 30, 2014.

Q4 Fiscal 2014 Earnings Conference Call and WebcastOracle will hold a conference call and webcast today to discuss these results at 2:00 p.m. Pacific. You may listen to the call by dialing 913.312.6699913.312.6699, Passcode:

822011. To access the live webcast of this event, please visit the Oracle Investor Relations website at http://www.oracle.com/investor. In addition, Oracle's Q4 results and Fiscal 2014 financial tables are available on the Oracle Investor Relations website.

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