For Oracle, Big Data Translates Into Big Bucks


Larry Ellison and Oracle (s orcl) aren’t interested when it comes to following the technology trends. They do their own thing, whether it’s mocking the cloud companies or hiring deposed chief executives of dreaded rivals. Somehow, it all works out for the company. Oracle reported blowout results for first quarter of 2011 on Friday, showing 47 percent year-over-year growth in revenues and 33 percent increase in non-GAAP, per-share earnings. Oracle’s sales for the quarter were $8.6 billion and (non-GAAP) profits are at $2.6 billion.

Furthermore, Ellison and Company have shown they can take a money-losing proposition like Sun Microsystems, turn it around and focus it toward making money-generating projects. Sun brought in $1.8 billion (in revenues) this quarter, with gross margins for Sun hardware up to 53 percent. Perhaps there was something to the “Sun being mismanaged” talk after all.

The real story of Oracle’s amazing revenue bump is the one we’ve been writing about for a long time: big data. As companies, big and small, struggle with the explosion of data, it is increasing demand for business analytics and data warehousing products. It’s the main reason why IBM (s IBM) snapped up Netezza and EMC (s EMC) bought Greenplum.

Both those acquisitions have had no impact on Oracle, which is benefitting big by bundling data warehousing and database software with Sun’s hardware, especially its top-end mega-servers. Oracle has three core products focused on the big data market: Exadata, Exalogic and Sun SPARC Superclusters.

Exadata is a combination of hardware and software focused on large data sets and is being widely adopted by old line (and cash rich) companies in the oil and gas exploration area.

The company currently has $2 billion in the pipeline for Exadata alone vs. $1.5 billion a quarter ago. “I think you are going to see a significant jump in Exadata sale going from Q2 to Q3, 2011,” Ellison said. “Think of 60 percent of what we’re doing right now is data warehouse.”

“Our goal is to become number one in the high-end server business for both Online Transaction Processing and Data Warehousing, both of those segments,” Ellison boasted on the conference call with Wall Street analysts. He acknowledged that IBM has good hardware and software, but was dismissive of HP (s hpq). “HP’s big servers are slow, expensive and have little or no software value add, “ he said. “That makes HP extremely vulnerable to market share losses in the coming year.”

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Vladimir Rodionov

The author forgot to mention Solaris OS – the most advanced server OS now. Sun Hardware + Sun Solaris + Oracle Middleware/DB. This is a very good proposition.

Dinesh Vadhia

In the con call, Ellison talks about new products and services coming out next year to address private and public clouds as well as a new suite of applications.

Factual ( closed a large funding round this week from A&H and announced the cloud service recently, both addressing the big data market but for companies that cannot afford in-house online data warehousing.

Rick Mainstreethost

Oracle is very much into the new trends, they have to to keep up with all the rest. mainstreethost

Sylvia Paull

Not true that Oracle doesn’t follow technology trends. Last year, the company boosted sales productivity and reduced training costs by using what’s called virtual instruction-led training (VIRT), a new trend in synchronous virtual training pioneered by 3g Selling (a client of mine).

Of course, someone needs to challenge Ellison for his attack of cloud computing, which seems more like a linguistic fracas than a dispute about what everyone is doing with data storage and access.

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