0001341439false00013414392024-09-092024-09-090001341439orcl:SeniorNotesDueJuly2025Member2024-09-092024-09-090001341439us-gaap:CommonStockMember2024-09-092024-09-09
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 8-K
CURRENT REPORT
Pursuant to Section 13 OR 15(d) of the
Securities Exchange Act of 1934
Date of Report (Date of earliest event reported): September 9, 2024
Oracle Corporation
(Exact name of registrant as specified in its charter)
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Delaware |
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001-35992 |
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54-2185193 |
(State or other jurisdiction of incorporation) |
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(Commission File Number) |
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(IRS Employer Identification No.) |
2300 Oracle Way, Austin, Texas 78741
(Address of principal executive offices) (Zip Code)
(737) 867-1000
(Registrant’s telephone number, including area code)
N/A
(Former name or former address, if changed since last report.)
Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions:
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☐ |
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Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425) |
☐ |
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Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12) |
☐ |
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Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b)) |
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Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c)) |
Securities registered pursuant to Section 12(b) of the Act:
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Title of each class |
Trading Symbol(s) |
Name of each exchange on which registered |
Common Stock, par value $0.01 per share 3.125% senior notes due July 2025 |
ORCL |
New York Stock Exchange New York Stock Exchange |
Indicate by check mark whether the registrant is an emerging growth company as defined in Rule 405 of the Securities Act of 1933 (§230.405 of this chapter) or Rule 12b-2 of the Securities Exchange Act of 1934 (§240.12b-2 of this chapter).
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Emerging growth company ☐ |
If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐
Section 2—Financial Information
Item 2.02 Results of Operations and Financial Condition
On September 9, 2024, Oracle Corporation (“Oracle”) issued a press release announcing financial results for its fiscal first quarter ended August 31, 2024. A copy of this press release is furnished as Exhibit 99.1 to this report.
Section 8—Other Events
Item 8.01 Other Events
Oracle announced that its Board of Directors has declared a cash dividend of $0.40 per share of outstanding common stock payable on October 24, 2024, to stockholders of record as of the close of business on October 10, 2024.
Section 9—Financial Statements and Exhibits
Item 9.01 Financial Statements and Exhibits
(d) Exhibits
SIGNATURE
Pursuant to the requirements of the Securities Exchange Act of 1934, as amended, the Registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.
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ORACLE CORPORATION |
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Dated: September 9, 2024 |
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By: |
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/s/ MARIA SMITH |
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Maria Smith Executive Vice President, Chief Accounting Officer (Principal Accounting Officer) |
Exhibit 99.1
For Immediate Release
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Contact: |
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Ken Bond |
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Deborah Hellinger |
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Oracle Investor Relations |
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Oracle Corporate Communications |
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1.650.607.0349 |
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1.212.508.7935 |
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ken.bond@oracle.com |
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deborah.hellinger@oracle.com |
Oracle Announces Fiscal 2025 First Quarter Financial Results
•Q1 GAAP Earnings per Share up 20% to $1.03, Non-GAAP Earnings per Share up 17% to $1.39
•Q1 Total Revenue $13.3 billion, up 7% in USD and up 8% in constant currency
•Q1 Total Remaining Performance Obligations up 53% to $99 billion
•Q1 Cloud Revenue (IaaS plus SaaS) $5.6 billion, up 21% in USD and up 22% in constant currency
•Q1 Cloud Infrastructure (IaaS) Revenue $2.2 billion, up 45% in USD and up 46% in constant currency
•Q1 Cloud Application (SaaS) Revenue $3.5 billion, up 10% in both USD and constant currency
•Q1 Fusion Cloud ERP (SaaS) Revenue $0.9 billion, up 16% in USD and up 17% in constant currency
•Q1 NetSuite Cloud ERP (SaaS) Revenue $0.9 billion, up 20% in both USD and constant currency
AUSTIN, Texas, September 9, 2024 -- Oracle Corporation (NYSE: ORCL) today announced fiscal 2025 Q1 results. Total quarterly revenues were up 7% year-over-year in USD, and up 8% in constant currency to $13.3 billion. Cloud services revenues were up 21% year-over-year in USD, and up 22% in constant currency to $5.6 billion. Cloud license and on-premise license revenues were up 7% in USD and up 8% in constant currency to $870 million.
Q1 GAAP operating income was $4.0 billion. Non-GAAP operating income was $5.7 billion, up 13% in USD and up 14% in constant currency. GAAP operating margin was 30%, and non-GAAP operating margin was 43%. GAAP net income was $2.9 billion. Non-GAAP net income was $4.0 billion, up 18% in USD and up 19% in constant currency. Q1 GAAP earnings per share was $1.03, up 20% in USD and up 22% in constant currency, while non-GAAP earnings per share was $1.39, up 17% in USD and up 18% in constant currency.
Short-term deferred revenues were $11.5 billion. Over the last twelve months, operating cash flow was $19.1 billion and free cash flow was $11.3 billion.
“As Cloud Services became Oracle’s largest business, both our operating income and earnings per share growth accelerated,” said Oracle CEO, Safra Catz. “Non-GAAP operating income was up 14% in constant currency to $5.7 billion, and non-GAAP EPS was up 18% in constant currency to $1.39 in Q1. RPO was up 53% from last year to a record $99 billion. That strong contract backlog will increase revenue growth throughout FY25. But the biggest news of all was signing a MultiCloud agreement with AWS—including our latest technology Exadata hardware and Version 23ai of our database software—embedded into AWS cloud datacenters. AWS customers will get easy and convenient access to the Oracle database when we go live in December later this year.”
“Oracle has 162 cloud datacenters in operation and under construction around the world,” said Oracle Chairman and CTO, Larry Ellison. “The largest of these datacenters is 800 megawatts and will contain acres of NVIDIA GPU Clusters for training large scale AI models. In Q1, 42 additional cloud GPU contracts were signed for a total of $3 billion. Our database business growth rate is increasing as a result of our MultiCloud agreements with Microsoft and Google. At the end of Q1, 7 Oracle Cloud regions were live at Microsoft with 24 more being built, and 4 Oracle Cloud regions were live at Google with 14 more being built. Our recently signed AWS contract was a milestone in the MultiCloud Era. Soon customers will be able use the latest Oracle database technology from within every Hyperscaler’s cloud.”
The board of directors declared a quarterly cash dividend of $0.40 per share of outstanding common stock. This dividend will be paid to stockholders of record as of the close of business on October 10, 2024, with a payment date of October 24, 2024.
•A sample list of customers which purchased Oracle Cloud services during the quarter will be available at www.oracle.com/customers/earnings/.
•A list of recent technical innovations and announcements is available at www.oracle.com/news/.
•To learn what industry analysts have been saying about Oracle’s products and services see www.oracle.com/corporate/analyst-reports/.
Earnings Conference Call and Webcast
Oracle will hold a conference call and webcast today to discuss these results at 4:00 p.m. Central. A live and replay webcast will be available on the Oracle Investor Relations website at www.oracle.com/investor/.
About Oracle
Oracle offers integrated suites of applications plus secure, autonomous infrastructure in the Oracle Cloud. For more information about Oracle (NYSE: ORCL), please visit us at www.oracle.com.
# # #
Trademarks
Oracle, Java, MySQL, and NetSuite are registered trademarks of Oracle Corporation. NetSuite was the first cloud company—ushering in the new era of cloud computing.
"Safe Harbor" Statement: Statements in this press release relating to future plans, expectations, beliefs, intentions and prospects, including the expectations for converting the Remaining Performance Obligations to revenue, the timing and build out of additional datacenters, and future growth as a result of our MultiCloud strategy, are "forward-looking statements" and are subject to material risks and uncertainties. Risks and uncertainties that could affect our current expectations and our actual results, include, among others: our ability to develop new products and services, integrate acquired products and services and enhance our existing products and services, including our AI products; our management of complex cloud and hardware offerings, including the sourcing of technologies and technology components; our ability to secure data center capacity; significant coding, manufacturing or configuration errors in our offerings; risks associated with acquisitions; economic, political and market conditions; information technology system failures, privacy and data security concerns; cybersecurity breaches; unfavorable legal proceedings, government investigations, and complex and changing laws and regulations. A detailed discussion of these factors and other risks that affect our business is contained in our SEC filings, including our most recent reports on Form 10-K and Form 10-Q, particularly under the heading "Risk Factors." Copies of these filings are available online from the SEC or by contacting Oracle's Investor Relations Department at (650) 506-4073 or by clicking on SEC Filings on the Oracle Investor Relations website at www.oracle.com/investor/. All information set forth in this press release is current as of September 9, 2024. Oracle undertakes no duty to update any statement in light of new information or future events.
ORACLE CORPORATION
Q1 FISCAL 2025 FINANCIAL RESULTS
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
($ in millions, except per share data)
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Three Months Ended August 31, |
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% Increase |
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% Increase (Decrease) |
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2024 |
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% of Revenues |
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2023 |
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% of Revenues |
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(Decrease) in US $ |
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in Constant Currency (1) |
REVENUES |
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Cloud services and license support |
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$ |
10,519 |
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79% |
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$ |
9,547 |
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77% |
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10% |
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11% |
Cloud license and on-premise license |
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870 |
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7% |
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809 |
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6% |
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7% |
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8% |
Hardware |
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655 |
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5% |
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714 |
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6% |
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(8%) |
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(8%) |
Services |
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1,263 |
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9% |
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1,383 |
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11% |
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(9%) |
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(8%) |
Total revenues |
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13,307 |
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100% |
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12,453 |
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100% |
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7% |
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8% |
OPERATING EXPENSES |
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Cloud services and license support |
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2,597 |
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19% |
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2,179 |
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18% |
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19% |
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20% |
Hardware |
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162 |
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1% |
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219 |
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2% |
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(26%) |
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(25%) |
Services |
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1,147 |
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9% |
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1,212 |
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10% |
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(5%) |
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(5%) |
Sales and marketing |
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2,036 |
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15% |
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2,026 |
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16% |
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1% |
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1% |
Research and development |
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2,306 |
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17% |
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2,216 |
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18% |
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4% |
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5% |
General and administrative |
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358 |
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3% |
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393 |
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3% |
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(9%) |
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(8%) |
Amortization of intangible assets |
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624 |
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5% |
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763 |
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6% |
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(18%) |
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(18%) |
Acquisition related and other |
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13 |
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0% |
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11 |
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0% |
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9% |
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9% |
Restructuring |
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73 |
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1% |
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138 |
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1% |
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(47%) |
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(47%) |
Total operating expenses |
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9,316 |
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70% |
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9,157 |
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74% |
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2% |
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2% |
OPERATING INCOME |
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3,991 |
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30% |
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3,296 |
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26% |
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21% |
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22% |
Interest expense |
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(842 |
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(6%) |
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(872 |
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(7%) |
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(3%) |
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(3%) |
Non-operating income (expenses), net |
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20 |
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0% |
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(49 |
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0% |
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* |
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* |
INCOME BEFORE INCOME TAXES |
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3,169 |
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24% |
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2,375 |
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19% |
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33% |
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36% |
(Provision for) benefit from income taxes |
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(240 |
) |
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(2%) |
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45 |
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0% |
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* |
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* |
NET INCOME |
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$ |
2,929 |
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22% |
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$ |
2,420 |
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19% |
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21% |
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23% |
EARNINGS PER SHARE: |
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Basic |
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$ |
1.06 |
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$ |
0.89 |
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Diluted |
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$ |
1.03 |
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$ |
0.86 |
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WEIGHTED AVERAGE COMMON SHARES OUTSTANDING: |
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Basic |
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2,761 |
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2,728 |
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Diluted |
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2,851 |
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2,823 |
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(1)We compare the percent change in the results from one period to another period using constant currency disclosure. We present constant currency information to provide a framework for assessing how our underlying businesses performed excluding the effect of foreign currency rate fluctuations. To present this information, current and comparative prior period results for entities reporting in currencies other than United States dollars are converted into United States dollars at the exchange rates in effect on May 31, 2024, which was the last day of our prior fiscal year, rather than the actual exchange rates in effect during the respective periods. Movements in international currencies relative to the United States dollar during the three months ended August 31, 2024 compared with the corresponding prior year period decreased our total revenues by 1 percentage point and operating income by 1 percentage point.
ORACLE CORPORATION
Q1 FISCAL 2025 FINANCIAL RESULTS
RECONCILIATION OF SELECTED GAAP MEASURES TO NON-GAAP MEASURES (1)
($ in millions, except per share data)
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Three Months Ended August 31, |
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% Increase (Decrease) in US $ |
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% Increase (Decrease) in Constant Currency (2) |
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2024 GAAP |
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Adj. |
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2024 Non-GAAP |
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2023 GAAP |
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Adj. |
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2023 Non-GAAP |
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GAAP |
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Non-GAAP |
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GAAP |
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Non-GAAP |
TOTAL REVENUES |
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$ |
13,307 |
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$ |
— |
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$ |
13,307 |
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$ |
12,453 |
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$ |
— |
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$ |
12,453 |
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7% |
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7% |
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8% |
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8% |
TOTAL OPERATING EXPENSES |
|
$ |
9,316 |
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$ |
(1,717 |
) |
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$ |
7,599 |
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$ |
9,157 |
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$ |
(1,761 |
) |
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$ |
7,396 |
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2% |
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3% |
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2% |
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3% |
Stock-based compensation (3) |
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1,007 |
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(1,007 |
) |
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— |
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849 |
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(849 |
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— |
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19% |
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* |
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19% |
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* |
Amortization of intangible assets (4) |
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624 |
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(624 |
) |
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— |
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763 |
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(763 |
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— |
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(18%) |
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* |
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(18%) |
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* |
Acquisition related and other |
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13 |
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(13 |
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— |
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11 |
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(11 |
) |
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— |
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9% |
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* |
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9% |
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* |
Restructuring |
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73 |
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(73 |
) |
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— |
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138 |
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(138 |
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— |
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(47%) |
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* |
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(47%) |
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* |
OPERATING INCOME |
|
$ |
3,991 |
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$ |
1,717 |
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$ |
5,708 |
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$ |
3,296 |
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$ |
1,761 |
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$ |
5,057 |
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21% |
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13% |
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22% |
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14% |
OPERATING MARGIN % |
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30% |
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43% |
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26% |
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41% |
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353 bp. |
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228 bp. |
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366 bp. |
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232 bp. |
INCOME TAX EFFECTS (5) |
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$ |
(240 |
) |
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$ |
(682 |
) |
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$ |
(922 |
) |
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$ |
45 |
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$ |
(823 |
) |
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$ |
(778 |
) |
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* |
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18% |
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* |
|
20% |
NET INCOME |
|
$ |
2,929 |
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|
$ |
1,035 |
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|
$ |
3,964 |
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$ |
2,420 |
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$ |
938 |
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$ |
3,358 |
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21% |
|
18% |
|
23% |
|
19% |
DILUTED EARNINGS PER SHARE |
|
$ |
1.03 |
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$ |
1.39 |
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$ |
0.86 |
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|
|
|
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$ |
1.19 |
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20% |
|
17% |
|
22% |
|
18% |
DILUTED WEIGHTED AVERAGE COMMON SHARES OUTSTANDING |
|
|
2,851 |
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— |
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2,851 |
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2,823 |
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— |
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2,823 |
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1% |
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1% |
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1% |
|
1% |
(1)This presentation includes non-GAAP measures. Our non-GAAP measures are not meant to be considered in isolation or as a substitute for comparable GAAP measures, and should be read only in conjunction with our consolidated financial statements prepared in accordance with GAAP. For a detailed explanation of the adjustments made to comparable GAAP measures, the reasons why management uses these measures, the usefulness of these measures and the material limitations on the usefulness of these measures, please see Appendix A.
(2)We compare the percent change in the results from one period to another period using constant currency disclosure. We present constant currency information to provide a framework for assessing how our underlying businesses performed excluding the effect of foreign currency rate fluctuations. To present this information, current and comparative prior period results for entities reporting in currencies other than United States dollars are converted into United States dollars at the exchange rates in effect on May 31, 2024, which was the last day of our prior fiscal year, rather than the actual exchange rates in effect during the respective periods.
(3)Stock-based compensation was included in the following GAAP operating expense categories:
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|
Three Months Ended August 31, 2024 |
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Three Months Ended August 31, 2023 |
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GAAP |
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Adj. |
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Non-GAAP |
|
|
GAAP |
|
|
Adj. |
|
|
Non-GAAP |
|
Cloud services and license support |
|
$ |
141 |
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|
$ |
(141 |
) |
|
$ |
— |
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|
$ |
111 |
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|
$ |
(111 |
) |
|
$ |
— |
|
Hardware |
|
|
6 |
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(6 |
) |
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|
— |
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|
|
5 |
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|
|
(5 |
) |
|
|
— |
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Services |
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|
43 |
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|
|
(43 |
) |
|
|
— |
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|
|
34 |
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|
|
(34 |
) |
|
|
— |
|
Sales and marketing |
|
|
162 |
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|
|
(162 |
) |
|
|
— |
|
|
|
135 |
|
|
|
(135 |
) |
|
|
— |
|
Research and development |
|
|
569 |
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|
|
(569 |
) |
|
|
— |
|
|
|
484 |
|
|
|
(484 |
) |
|
|
— |
|
General and administrative |
|
|
86 |
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|
|
(86 |
) |
|
|
— |
|
|
|
80 |
|
|
|
(80 |
) |
|
|
— |
|
Total stock-based compensation |
|
$ |
1,007 |
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|
$ |
(1,007 |
) |
|
$ |
— |
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|
$ |
849 |
|
|
$ |
(849 |
) |
|
$ |
— |
|
(4)Estimated future annual amortization expense related to intangible assets as of August 31, 2024 was as follows:
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Remainder of fiscal 2025 |
|
$ |
1,683 |
|
Fiscal 2026 |
|
|
1,639 |
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Fiscal 2027 |
|
|
672 |
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Fiscal 2028 |
|
|
635 |
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Fiscal 2029 |
|
|
561 |
|
Fiscal 2030 |
|
|
522 |
|
Thereafter |
|
|
558 |
|
Total intangible assets, net |
|
$ |
6,270 |
|
(5)Income tax effects were calculated reflecting an effective GAAP tax rate of 7.6% and (1.9%) in the first quarter of fiscal 2025 and 2024, respectively, and an effective non-GAAP tax rate of 18.9% and 18.8% in the first quarter of fiscal 2025 and 2024, respectively. The difference in our GAAP and non-GAAP tax rates in each of the first quarters of fiscal 2025 and 2024 was primarily due to the net tax effects related to stock-based compensation expense; acquisition related and other items, including the tax effects on amortization of intangible assets; and restructuring expense, partially offset by the net deferred tax effects related to an income tax benefit that was previously recorded due to the partial realignment of our legal entity structure.
ORACLE CORPORATION
Q1 FISCAL 2025 FINANCIAL RESULTS
CONDENSED CONSOLIDATED BALANCE SHEETS
($ in millions)
|
|
|
|
|
|
|
|
|
|
|
August 31, 2024 |
|
|
May 31, 2024 |
|
ASSETS |
|
|
|
|
|
|
Current Assets: |
|
|
|
|
|
|
Cash and cash equivalents |
|
$ |
10,616 |
|
|
$ |
10,454 |
|
Marketable securities |
|
|
295 |
|
|
|
207 |
|
Trade receivables, net |
|
|
8,021 |
|
|
|
7,874 |
|
Prepaid expenses and other current assets |
|
|
4,140 |
|
|
|
4,019 |
|
Total Current Assets |
|
|
23,072 |
|
|
|
22,554 |
|
Non-Current Assets: |
|
|
|
|
|
|
Property, plant and equipment, net |
|
|
23,094 |
|
|
|
21,536 |
|
Intangible assets, net |
|
|
6,270 |
|
|
|
6,890 |
|
Goodwill, net |
|
|
62,249 |
|
|
|
62,230 |
|
Deferred tax assets |
|
|
12,219 |
|
|
|
12,273 |
|
Other non-current assets |
|
|
17,310 |
|
|
|
15,493 |
|
Total Non-Current Assets |
|
|
121,142 |
|
|
|
118,422 |
|
TOTAL ASSETS |
|
$ |
144,214 |
|
|
$ |
140,976 |
|
LIABILITIES AND STOCKHOLDERS’ EQUITY |
|
|
|
|
|
|
Current Liabilities: |
|
|
|
|
|
|
Notes payable and other borrowings, current |
|
$ |
9,201 |
|
|
$ |
10,605 |
|
Accounts payable |
|
|
2,207 |
|
|
|
2,357 |
|
Accrued compensation and related benefits |
|
|
1,772 |
|
|
|
1,916 |
|
Deferred revenues |
|
|
11,455 |
|
|
|
9,313 |
|
Other current liabilities |
|
|
7,410 |
|
|
|
7,353 |
|
Total Current Liabilities |
|
|
32,045 |
|
|
|
31,544 |
|
Non-Current Liabilities: |
|
|
|
|
|
|
Notes payable and other borrowings, non-current |
|
|
75,314 |
|
|
|
76,264 |
|
Income taxes payable |
|
|
11,038 |
|
|
|
10,817 |
|
Deferred tax liabilities |
|
|
3,442 |
|
|
|
3,692 |
|
Other non-current liabilities |
|
|
11,106 |
|
|
|
9,420 |
|
Total Non-Current Liabilities |
|
|
100,900 |
|
|
|
100,193 |
|
Stockholders’ Equity |
|
|
11,269 |
|
|
|
9,239 |
|
TOTAL LIABILITIES AND STOCKHOLDERS’ EQUITY |
|
$ |
144,214 |
|
|
$ |
140,976 |
|
ORACLE CORPORATION
Q1 FISCAL 2025 FINANCIAL RESULTS
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
($ in millions)
|
|
|
|
|
|
|
|
|
Three Months Ended August 31, |
|
|
2024 |
|
|
2023 |
|
Cash Flows From Operating Activities: |
|
|
|
|
|
Net income |
$ |
2,929 |
|
|
$ |
2,420 |
|
Adjustments to reconcile net income to net cash provided by operating activities: |
|
|
|
|
|
Depreciation |
|
804 |
|
|
|
712 |
|
Amortization of intangible assets |
|
624 |
|
|
|
763 |
|
Deferred income taxes |
|
(151 |
) |
|
|
(517 |
) |
Stock-based compensation |
|
1,007 |
|
|
|
849 |
|
Other, net |
|
130 |
|
|
|
169 |
|
Changes in operating assets and liabilities: |
|
|
|
|
|
(Increase) decrease in trade receivables, net |
|
(81 |
) |
|
|
380 |
|
Decrease in prepaid expenses and other assets |
|
367 |
|
|
|
269 |
|
Decrease in accounts payable and other liabilities |
|
(531 |
) |
|
|
(457 |
) |
Increase in income taxes payable |
|
24 |
|
|
|
69 |
|
Increase in deferred revenues |
|
2,305 |
|
|
|
2,317 |
|
Net cash provided by operating activities |
|
7,427 |
|
|
|
6,974 |
|
Cash Flows From Investing Activities: |
|
|
|
|
|
Purchases of marketable securities and other investments |
|
(477 |
) |
|
|
(333 |
) |
Proceeds from sales and maturities of marketable securities and other investments |
|
15 |
|
|
|
85 |
|
Capital expenditures |
|
(2,303 |
) |
|
|
(1,314 |
) |
Net cash used for investing activities |
|
(2,765 |
) |
|
|
(1,562 |
) |
Cash Flows From Financing Activities: |
|
|
|
|
|
Payments for repurchases of common stock |
|
(150 |
) |
|
|
(150 |
) |
Proceeds from issuances of common stock |
|
179 |
|
|
|
308 |
|
Shares repurchased for tax withholdings upon vesting of restricted stock-based awards |
|
(851 |
) |
|
|
(1,060 |
) |
Payments of dividends to stockholders |
|
(1,103 |
) |
|
|
(1,091 |
) |
Repayments of commercial paper, net |
|
(396 |
) |
|
|
(562 |
) |
Proceeds from issuances of term loan credit agreements |
|
5,627 |
|
|
|
— |
|
Repayments of senior notes and term loan credit agreements |
|
(7,630 |
) |
|
|
(1,000 |
) |
Other, net |
|
(261 |
) |
|
|
27 |
|
Net cash used for financing activities |
|
(4,585 |
) |
|
|
(3,528 |
) |
Effect of exchange rate changes on cash and cash equivalents |
|
85 |
|
|
|
(36 |
) |
Net increase in cash and cash equivalents |
|
162 |
|
|
|
1,848 |
|
Cash and cash equivalents at beginning of period |
|
10,454 |
|
|
|
9,765 |
|
Cash and cash equivalents at end of period |
$ |
10,616 |
|
|
$ |
11,613 |
|
ORACLE CORPORATION
Q1 FISCAL 2025 FINANCIAL RESULTS
FREE CASH FLOW - TRAILING 4-QUARTERS (1)
($ in millions)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Fiscal 2024 |
|
|
Fiscal 2025 |
|
|
Q1 |
|
Q2 |
|
Q3 |
|
Q4 |
|
|
Q1 |
|
Q2 |
Q3 |
Q4 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
GAAP Operating Cash Flow |
|
$ |
17,745 |
|
$ |
17,039 |
|
$ |
18,239 |
|
$ |
18,673 |
|
|
$ |
19,126 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Capital Expenditures |
|
|
(8,290 |
) |
|
(6,935 |
) |
|
(5,981 |
) |
|
(6,866 |
) |
|
|
(7,855 |
) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Free Cash Flow |
|
$ |
9,455 |
|
$ |
10,104 |
|
$ |
12,258 |
|
$ |
11,807 |
|
|
$ |
11,271 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Operating Cash Flow % Growth over prior year |
|
68% |
|
13% |
|
18% |
|
9% |
|
|
8% |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Free Cash Flow % Growth over prior year |
|
76% |
|
20% |
|
68% |
|
39% |
|
|
19% |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
GAAP Net Income |
|
$ |
9,375 |
|
$ |
10,137 |
|
$ |
10,642 |
|
$ |
10,467 |
|
|
$ |
10,976 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Operating Cash Flow as a % of Net Income |
|
189% |
|
168% |
|
171% |
|
178% |
|
|
174% |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Free Cash Flow as a % of Net Income |
|
101% |
|
100% |
|
115% |
|
113% |
|
|
103% |
|
|
|
|
(1)To supplement our statements of cash flows presented on a GAAP basis, we use non-GAAP measures of cash flows on a trailing 4-quarter basis to analyze cash flow generated from operations. We believe free cash flow is also useful as one of the bases for comparing our performance with our competitors. The presentation of non-GAAP free cash flow is not meant to be considered in isolation or as an alternative to net income as an indicator of our performance, or as an alternative to cash flows from operating activities as a measure of liquidity.
ORACLE CORPORATION
Q1 FISCAL 2025 FINANCIAL RESULTS
SUPPLEMENTAL ANALYSIS OF GAAP REVENUES (1)
($ in millions)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Fiscal 2024 |
|
|
Fiscal 2025 |
|
|
|
Q1 |
|
Q2 |
|
Q3 |
|
Q4 |
|
TOTAL |
|
|
Q1 |
|
Q2 |
Q3 |
Q4 |
TOTAL |
|
REVENUES BY OFFERINGS |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Cloud services |
|
$ |
4,635 |
|
$ |
4,775 |
|
$ |
5,054 |
|
$ |
5,311 |
|
$ |
19,774 |
|
|
$ |
5,623 |
|
|
|
|
$ |
5,623 |
|
License support |
|
|
4,912 |
|
|
4,864 |
|
|
4,909 |
|
|
4,923 |
|
|
19,609 |
|
|
|
4,896 |
|
|
|
|
|
4,896 |
|
Cloud services and license support |
|
|
9,547 |
|
|
9,639 |
|
|
9,963 |
|
|
10,234 |
|
|
39,383 |
|
|
|
10,519 |
|
|
|
|
|
10,519 |
|
Cloud license and on-premise license |
|
|
809 |
|
|
1,178 |
|
|
1,256 |
|
|
1,838 |
|
|
5,081 |
|
|
|
870 |
|
|
|
|
|
870 |
|
Hardware |
|
|
714 |
|
|
756 |
|
|
754 |
|
|
842 |
|
|
3,066 |
|
|
|
655 |
|
|
|
|
|
655 |
|
Services |
|
|
1,383 |
|
|
1,368 |
|
|
1,307 |
|
|
1,373 |
|
|
5,431 |
|
|
|
1,263 |
|
|
|
|
|
1,263 |
|
Total revenues |
|
$ |
12,453 |
|
$ |
12,941 |
|
$ |
13,280 |
|
$ |
14,287 |
|
$ |
52,961 |
|
|
$ |
13,307 |
|
|
|
|
$ |
13,307 |
|
AS REPORTED REVENUE GROWTH RATES |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Cloud services |
|
30% |
|
25% |
|
25% |
|
20% |
|
25% |
|
|
21% |
|
|
|
|
21% |
|
License support |
|
2% |
|
2% |
|
1% |
|
0% |
|
1% |
|
|
0% |
|
|
|
|
0% |
|
Cloud services and license support |
|
13% |
|
12% |
|
12% |
|
9% |
|
12% |
|
|
10% |
|
|
|
|
10% |
|
Cloud license and on-premise license |
|
(10%) |
|
(18%) |
|
(3%) |
|
(15%) |
|
(12%) |
|
|
7% |
|
|
|
|
7% |
|
Hardware |
|
(6%) |
|
(11%) |
|
(7%) |
|
(1%) |
|
(6%) |
|
|
(8%) |
|
|
|
|
(8%) |
|
Services |
|
2% |
|
(2%) |
|
(5%) |
|
(6%) |
|
(3%) |
|
|
(9%) |
|
|
|
|
(9%) |
|
Total revenues |
|
9% |
|
5% |
|
7% |
|
3% |
|
6% |
|
|
7% |
|
|
|
|
7% |
|
CONSTANT CURRENCY REVENUE GROWTH RATES (2) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Cloud services |
|
29% |
|
24% |
|
24% |
|
20% |
|
24% |
|
|
22% |
|
|
|
|
22% |
|
License support |
|
0% |
|
0% |
|
1% |
|
1% |
|
0% |
|
|
0% |
|
|
|
|
0% |
|
Cloud services and license support |
|
12% |
|
11% |
|
11% |
|
10% |
|
11% |
|
|
11% |
|
|
|
|
11% |
|
Cloud license and on-premise license |
|
(11%) |
|
(19%) |
|
(3%) |
|
(14%) |
|
(12%) |
|
|
8% |
|
|
|
|
8% |
|
Hardware |
|
(8%) |
|
(12%) |
|
(7%) |
|
0% |
|
(7%) |
|
|
(8%) |
|
|
|
|
(8%) |
|
Services |
|
1% |
|
(3%) |
|
(5%) |
|
(6%) |
|
(3%) |
|
|
(8%) |
|
|
|
|
(8%) |
|
Total revenues |
|
8% |
|
4% |
|
7% |
|
4% |
|
6% |
|
|
8% |
|
|
|
|
8% |
|
CLOUD SERVICES AND LICENSE SUPPORT REVENUES BY ECOSYSTEM |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Applications cloud services and license support |
|
$ |
4,471 |
|
$ |
4,474 |
|
$ |
4,584 |
|
$ |
4,642 |
|
$ |
18,172 |
|
|
$ |
4,769 |
|
|
|
|
$ |
4,769 |
|
Infrastructure cloud services and license support |
|
|
5,076 |
|
|
5,165 |
|
|
5,379 |
|
|
5,592 |
|
|
21,211 |
|
|
|
5,750 |
|
|
|
|
|
5,750 |
|
Total cloud services and license support revenues |
|
$ |
9,547 |
|
$ |
9,639 |
|
$ |
9,963 |
|
$ |
10,234 |
|
$ |
39,383 |
|
|
$ |
10,519 |
|
|
|
|
$ |
10,519 |
|
AS REPORTED REVENUE GROWTH RATES |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Applications cloud services and license support |
|
11% |
|
10% |
|
10% |
|
6% |
|
9% |
|
|
7% |
|
|
|
|
7% |
|
Infrastructure cloud services and license support |
|
15% |
|
14% |
|
13% |
|
12% |
|
14% |
|
|
13% |
|
|
|
|
13% |
|
Total cloud services and license support revenues |
|
13% |
|
12% |
|
12% |
|
9% |
|
12% |
|
|
10% |
|
|
|
|
10% |
|
CONSTANT CURRENCY REVENUE GROWTH RATES (2) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Applications cloud services and license support |
|
11% |
|
9% |
|
10% |
|
6% |
|
9% |
|
|
7% |
|
|
|
|
7% |
|
Infrastructure cloud services and license support |
|
14% |
|
12% |
|
13% |
|
13% |
|
13% |
|
|
14% |
|
|
|
|
14% |
|
Total cloud services and license support revenues |
|
12% |
|
11% |
|
11% |
|
10% |
|
11% |
|
|
11% |
|
|
|
|
11% |
|
GEOGRAPHIC REVENUES |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Americas |
|
$ |
7,841 |
|
$ |
8,067 |
|
$ |
8,270 |
|
$ |
8,945 |
|
$ |
33,122 |
|
|
$ |
8,372 |
|
|
|
|
$ |
8,372 |
|
Europe/Middle East/Africa |
|
|
3,005 |
|
|
3,170 |
|
|
3,316 |
|
|
3,539 |
|
|
13,030 |
|
|
|
3,228 |
|
|
|
|
|
3,228 |
|
Asia Pacific |
|
|
1,607 |
|
|
1,704 |
|
|
1,694 |
|
|
1,803 |
|
|
6,809 |
|
|
|
1,707 |
|
|
|
|
|
1,707 |
|
Total revenues |
|
$ |
12,453 |
|
$ |
12,941 |
|
$ |
13,280 |
|
$ |
14,287 |
|
$ |
52,961 |
|
|
$ |
13,307 |
|
|
|
|
$ |
13,307 |
|
(1)The sum of the quarterly information presented may vary from the year-to-date information presented due to rounding.
(2)We compare the percent change in the results from one period to another period using constant currency disclosure. We present constant currency information to provide a framework for assessing how our underlying businesses performed excluding the effect of foreign currency rate fluctuations. To present this information, current and comparative prior period results for entities reporting in currencies other than United States dollars are converted into United States dollars at the exchange rates in effect on May 31, 2024 and 2023 for the fiscal 2025 and fiscal 2024 constant currency growth rate calculations presented, respectively, rather than the actual exchange rates in effect during the respective periods.
APPENDIX A
ORACLE CORPORATION
Q1 FISCAL 2025 FINANCIAL RESULTS
EXPLANATION OF NON-GAAP MEASURES
To supplement our financial results presented on a GAAP basis, we use the non-GAAP measures indicated in the tables, which exclude certain business combination accounting entries and expenses related to acquisitions, as well as other significant expenses including stock-based compensation, that we believe are helpful in understanding our past financial performance and our future results. Our non-GAAP financial measures are not meant to be considered in isolation or as a substitute for comparable GAAP measures and should be read only in conjunction with our consolidated financial statements prepared in accordance with GAAP. Our management regularly uses our supplemental non-GAAP financial measures internally to understand, manage and evaluate our business and make operating decisions. These non-GAAP measures are among the primary factors management uses in planning for and forecasting future periods. Compensation of our executives is based in part on the performance of our business based on these non-GAAP measures. Our non-GAAP financial measures reflect adjustments based on the following items, as well as the related income tax effects:
Stock-based compensation expenses: We have excluded the effect of stock-based compensation expenses from our non-GAAP operating expenses, income tax effects and net income measures. Although stock-based compensation is a key incentive offered to our employees, and we believe such compensation contributed to the revenues earned during the periods presented and also believe it will contribute to the generation of future period revenues, we continue to evaluate our business performance excluding stock-based compensation expenses. Stock-based compensation expenses will recur in future periods.
Amortization of intangible assets: We have excluded the effect of amortization of intangible assets from our non-GAAP operating expenses, income tax effects and net income measures. Amortization of intangible assets is inconsistent in amount and frequency and is significantly affected by the timing and size of our acquisitions. Investors should note that the use of intangible assets contributed to our revenues earned during the periods presented and will contribute to our future period revenues as well. Amortization of intangible assets will recur in future periods.