Oracle manages slight turnaround in hardware revenue

Oracle posted higher third-quarter revenue and profit that failed to satisfy investors looking for signs of a sustained turnaround and its shares fell about 4 percent. Shareholders had grown more optimistic after Oracle’s previous quarterly results, but still worried about slow IT spending and growing competition from smaller, nimble rivals. On Tuesday, the company also forecast current-quarter results roughly in line with investors’ targets.

Oracle’s third-quarter revenue rose 4 percent to $9.3 billion while net income increased 2 percent to $2.6 billion, buoyed by growth in new software licenses and cloud subscriptions as well as a long-anticipated rise in hardware product revenue. Hardware systems product sales, which had declined steadily since Oracle’s acquisition of Sun Microsystems, were up 8 percent to $725 million in the quarter ended Feb. 28, while hardware systems support revenue increased 5 percent to $598 million. New software licenses and cloud subscription revenue rose a combined 4 percent to $2.4 billion. Software license updates and product support revenue jumped 5 percent to $4.6 billion.