Oracle Corp signaled a recovery in client spending as remote work spurred demand for cloud services as well as traditional licensing business, helping it beat expectations for first-quarter results and sending its shares up 5% on Thursday.
The COVID-19 pandemic has led to a rapid shift to remote work with companies looking to extend it till the next year, benefiting cloud companies that support this move. It comes at a time when Oracle has been pushing into the cloud business that helps companies save cost by renting data centers rather than owning them.
Revenue from its largest the unit, that includes its cloud services, rose 2.1% to $6.95 billion. Total revenue rose 1.6% to $9.37 billion, beating analysts' average estimate of $9.19 billion, according to IBES data from Refinitiv.
The company's net income rose to $2.25 billion, or 72 cents per share, in the first quarter ended Aug. 31, from $2.14 billion, or 63 cents per share, a year earlier. On an adjusted basis, Oracle earned 93 cents per share, above market expectation of 86 cents per share.