Oracle Corporation (NYSE:ORCL) posted the fiscal second quarter earnings on Wednesday and the company managed to beat the estimates both on revenues and EPS. The major talking point of the report was the incredible 47% Year-Over-Year growth in cloud business revenues. Due to the strong quarter results and Oracle Corporation (NYSE:ORCL)’s positive guidance for fiscal third quarter revenue growth, the stock jumped by 4% as it started trading on Thursday. Panmure Gordon’s Senior Analyst, George O’Connor talked on CNBC about the catalyst behind the big move up in Oracle Corporation (NYSE:ORCL)’s stock.
O’Connor feels that there are two major catalyst behind this big move up in Oracle Corporation (NYSE:ORCL) stock. He pointed out that the first reason obviously is the strong quarter results. He added that the second reason is the macro backdrop coming out of the feds meet in United States.
“[…] expectations were very low going into this quarter set of numbers. […] They missed three times, so there is a bit of relief in here as well that they didn’t blow out,” O’Connor said.
Many organizations manage to beat or meet the streets expectations by a lot of options like cost cutting, etc. O’Connor thinks that Oracle Corporation (NYSE:ORCL) managed to beat the expectations purely because of good execution on the cloud business. He feels that there are few people in the tech like Oracle Corporation (NYSE:ORCL) who sells the old stuff.
O’Connor said that the strategy of going with the old tech and the backdrop from feds meet helped companies like Oracle Corporation (NYSE:ORCL) in 2014, but he feels that, it might not happen in 2015. He thinks that investors are looking for consistent growth in tech sector and he doubts if the companies like Oracle Corporation (NYSE:ORCL), which deals with old tech could deliver consistent growth.
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