Analysts fear that there could be a sharper downturn in the hardware market than they expected after Oracle posted poor quarterly results because of its slow hardware sales.
Oracle shares took a tumble and fell by six percent, following gloomy results for Micron the day before.
Generally the strokers of beards and people in the know are really worried about how well the technology sector is holding up in the face of shaky economies, especially in Europe.
Oracle reports its fiscal quarters differently from others so its results tend to give a glimpse of business conditions in April and May.
Trip Chowdhry, an analyst with Global Equities Research, told Reuters that Oracle’s results suggest companies are not spending money on technology and other outfits are going to go the same way.
It was not all gloom in Oracle’s results. Its quarterly profit surpassed expectations by nearly six percent. But Oracle has always done better than its expectations and for some reason Wall Street expected ten percent.
Its fiscal fourth quarter revenue rose 13 percent from a year earlier to $10.8 billion.
The problem for Oracle is the hardware division, which it acquired after it bought Sun Microsystems.
President Safra Catz said that sales fell because Oracle had walked away from deals that would have been unprofitable.
He somewhat sarcastically said that Oracle would rather make money than just revenue.
But one of the problems that analysts and investors have when Ellison bought Sun was whether or not Oracle could turn the outfit’s hardware business around. While Oracle is battling with lacklustre sales in Europe, these figures seem to indicate that hardware isn’t its bag.