Modern software products, extensive conditions for computing and storing data, comprehensive support of IT processes – this is Oracle.
According to the results of the second quarter of fiscal year 2023, Oracle turned out to be very good:

• revenue +18% YoY to $12.3 billion, above expectations;
• EPS of $1.21 per share vs. forecast of $1.17;
• operating margin 41% vs. 47% a year earlier;
• operating cash flow of $7.2 billion versus $1.7 billion a year earlier;
• capital expenditures of $4.1 billion versus $2.0 billion previously.

The company has invested in the construction of data centers and the development of network infrastructure – hence the expansion of capital expenditures.

Oracle makes the main bet, as before, on the cloud sector. This brings the company closer to its competitors, but this position does not look like a losing one. The revenue of the Iaas service (a business model that provides IT infrastructure in the form of resources for storing information or computing it for payments via the Internet) expanded by 54% YoY, the SaaS service (software products, the “cloud” itself) – by 40% yoy.

The purchase of Cerner worked great.
Oracle may think about reducing the pace of hiring staff or even slightly reduce staff, judging by the increase in operating costs. This is understandable: inflation in the US remains quite high, companies raise wages, but costs are growing faster. It is unlikely that this will affect cloud services.

If Oracle continues to rely on software business models and increases the bet on the cloud and everything related to it, the company’s shares will remain better than the market.

The consensus forecast for Oracle securities prices in the long term has been revised to improve, from the previous target of $90-92 to $108-110.