Oracle shares are up 10% after-hours: what’s fuelling the stock?

Shares of Oracle Corp (NYSE: ORCL) are up more than 10% in extended trading on market-beating results for the fiscal second quarter and authorisation for a new share repurchase programme.

Q2 financial results

Oracle said it lost $1.25 billion in Q2 that translates to 46 cents per share. In the comparable quarter of last year, it had posted $2.44 billion in net income or 80 cents per share. On an adjusted basis, the computer technology company earned $1.21 per share.

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The American multinational generated $10.36 billion in revenue that translates to an annualised growth of 6.0%. According to FactSet, experts had forecast $1.11 in adjusted EPS on $10.2 billion in revenue.

The Texas-based company attributed its net loss in the recent quarter to a payment related to a years-old dispute over former CEO Mark Hurd’s employment.

Other notable figures

Other notable figures in the quarterly results include a 22% year-over-year increase in cloud revenue and $10.3 billion in operating cash flow over the trailing twelve months. According to CEO Safra Catz:

“We now have 8,500 Fusion ERP customers with revenue growing 35%, 28,400 NetSuite ERP customers with revenue growing 29%, and our Gen2 infrastructure businesses are growing even faster—and accelerating.”

Oracle also reiterated its commitment to opening cloud data centres in Israel, Mexico, South Africa, Colombia, Italy, Singapore, France, and Sweden, in line with its original announcement in October.

Dividend and stock buyback

Oracle declared 32 cents of quarterly cash dividend and said its board authorised another $10 billion worth of stock buyback. In the earnings press release, Chairman Larry Ellison said:

“Because of their extreme high-performance, Oracle’s Autonomous Database and new MySQL Database with HeatWave present huge growth opportunities for our cloud infrastructure business. Oracle database on-premise customers are choosing our Autonomous Database as they move to the public cloud. Amazon Aurora customers are discovering that moving to MySQL with HeatWave can increase their performance by more than ten times—with a corresponding reduction in cost. These two databases will sustain Oracle’s database market and technology leadership for years to come.”