Oracle Corp. shares dropped 6.3 per cent as investors were disappointed that its profit beat estimates than a narrower margin than in recent quarters.
It released the disappointing results as Micron Technology Inc. reported quarterly revenue below expectations. The reports from the two companies don't bode well for other tech companies, which face shaky economies, especially in Europe. Most tech companies don't report until next month.
"IT spend has slowed down. Any company that is in technology is going to get impacted," said Trip Chowdhry, an analyst with Global Equities Research.
Oracle reported profit, excluding items, of 75 cents (U.S.) per share for the quarter ended May 31. That beat Wall Street estimates of 71 cents per share by 5.6 per cent, according to Thomson Reuters I/B/E/S. On average it has exceeded profit estimates by 10 per cent over the past six quarters.
"Traditionally in the fourth quarter they usually beat by a huge margin. This time they just managed just to beat," Mr. Chowdhry added.
Quarterly revenue rose 13 per cent from a year earlier to $10.8-billion, in line with the average analyst forecast of $10.75-billion.
The world's No. 3 software maker reported that fourth-quarter new software sales rose 19 per cent from a year earlier to $3.7-billion. That beat its own forecasts of 4 per cent to 14 per cent growth.
Yet sales in its hardware division, which it acquired with its purchase of Sun Microsystems, dropped 6 per cent to $1.2-billion.
Oracle shares fell 6.3 per cent to $30.40 in extended trade, down from their Nasdaq close of $32.46.Report Typo/Error