Oracle’s hardware woes continued in its first quarter. For the period ending Aug. 31, Oracle saw server revenue off 14 percent to $669 million compared to $779 million for the same time last year.
One relative bright spot was that revenue on hardware support was actually up 5 percent, because the company requires support contracts on all hardware sold and sells its high-end servers with lots of Oracle software.
As Oracle Co-President Mark Hurd told analysts on the earnings call Wednesday night:
“… we realigned our business so that as we sort of shifted to these very high Oracle content products, we now attach support all the time. And as a result, the growth of support is not symmetrical with the product growth rate.”
As is their usual practice, Oracle execs on the call (transcript here) stressed that the margin on the hardware they do sell is good.
But they also sounded a note of caution. “Hardware product revenue could range from negative 9% to positive 1% in constant dollars and negative 11% to negative 1% in reported dollars,” Oracle co-president Safra Catz said.
Oracle’s server revenue has now slipped for several consecutive quarters. For its fourth quarter, ended May 31, it was off 13 percent to $849 million from $977 million year-over-year.