Oracle's sales dip but profit meets estimates

Oracle's sales dip but profit meets estimates

The business software maker says earnings rose in the company's first quarter even as sales fell 7%.

NEW YORK (CNNMoney.com) -- Database software maker Oracle reported fiscal first-quarter profit Wednesday that met analysts' expectations, even as sales fell.

The Redwood Shores, Calif.-based company reported net income of $1.1 billion, or 22 cents per share, for the three months ended Aug. 31. That was up 8% from earnings of $1.07 billion, or 21 cents per share, a year earlier.

Excluding certain items, Oracle said it earned $1.5 billion, or 30 cents per share, which was in line with estimates from analysts surveyed by Thompson Reuters.

Oracle said unfavorable foreign exchange rates drove down earnings per share by 2 cents.

Sales for the quarter fell 7% to $5.1 billion, versus estimates for $5.25 billion in revenue.

The company said sales of new software licenses sank 17% to $1 billion, while software license updates and product support revenues were up 6% to $3.1 billion.

Oracle also declared a cash dividend of 5 cents per share of outstanding common stock, which will be paid Nov. 4.

Safra Catz, Oracle's president, said the company was able to increase profit despite weak sales by "substantially" improving its operating margins.

"Our operating model continues to drive earnings for our stockholders," she said in a statement.

Oracle (ORCL, Fortune 500) shares were down in extended trading after closing at $22.66 in New York.

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