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Oracle shares dive after severe third-quarter miss; analysts cut views
March 21, 2013 / 4:20 PM / in 5 years

Oracle shares dive after severe third-quarter miss; analysts cut views

SAN FRANCISCO (Reuters) - Oracle Corp’s shares sank more than 8 percent on Thursday a day after the company reported sharply disappointing third-quarter new software revenue, which it blamed on poor sales execution

The company logo is shown at the headquarters of Oracle Corporation in Redwood City, California in this February 2, 2010 file photograph. REUTERS/Robert Galbraith/Files

The severe miss, reported after the market close on Wednesday, triggered a series of price-target cuts from Wall Street.

The stock was on track for its largest single-day loss since December 2011, when it also reported disappointing quarterly results. The shares were down 8.2 percent at $32.83 at midday.

Credit Agricole reduced its rating on Oracle, the world’s No. 3 software maker, to “underperform” from “outperform” and cut its share target price to $35 from $38. Evercore Partners cut its rating to “equal-weight” from “overweight.”

Other brokerages, including Wedbush, Stifel and RBC, reduced their price targets but maintained their recommendations.

The company, which is battling fast-growing rivals like Salesforce and Workday in the field of Internet-based software services, on Wednesday reported a 2 percent slip in new software sales and Internet-based subscriptions. Analysts had on average projected a gain of 8 percent.

The company forecast that new software license sales, a key indicator of future revenue, will rise 1 percent to 11 percent this quarter. It warned that revenue from its ailing hardware business will continue to shrink significantly.

Editing by Leslie Adler

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