Wall Street Beat: As earnings season begins, tech looks stable

Confidence in technology, especially software, appears to remain strong

With companies including Oracle, Tibco and Adobe issuing quarterly financial statements this week, earnings season is under way and despite mixed reports on the economy, confidence in tech appears to be stable.

Stocks on the Nasdaq Computer index rose in aggregate by Friday, closing out the week at 1724.13, about 12 points higher than last week's close. As has been the case for most of the year, software remains a bright spot.

Oracle, which traditionally kicks off the earnings season for tech, on Thursday said that new software license sales and cloud subscription revenue rose 5 percent year over year for the three-month period ending Aug. 31. This helped the company's profit rise by 11 percent to US$2 billion. Overall sales, however, dropped 2 percent to $8.2 billion. Hardware sales were a culprit, declining by 24 percent to $779 million in the quarter.

Canaccord Genuity technology analyst Richard Davis called Oracle's performance "a solid but unexceptional quarter." Oracle shares, meanwhile, ticked up by $0.21 to close at $32.41 Friday.

Middleware vendor Tibco on Thursday reported a solid quarter, with revenue for the three months ending September totaling $255 million and net income rising to $26.1 million. This compares to revenue of $229 million and net income of $23.5 million for the year-earlier period. Tibco shares Friday rose by $0.47 to close at $30.33.

Tibco sales are being fueled to a large degree by efforts on the part of enterprises to do real-time analysis of "big data," not only from customer data generated via mobile devices but also information transmitted via machines such as point-of-sale devices, said Tibco CEO Vivek Ranadivé in an interview.

"We continue to see what I believe to be early signs of growing dollar commitments to our platform," Ranadivé said. Customers who were buying pieces of Tibco's real-time analysis software are now moving toward fitting those products together into systems that offer actionable information, he said. "If you're in a retail store looking for medium-size blue jeans and can't find them, the store should be able to look at its inventory system and suggest another store location where you can find something similar," he noted.

Meanwhile, digital publishing software maker Adobe on Wednesday reported sales and income that edged out year-earlier results. Sales for the three months ending Aug. 31 came in at $1.08 billion, up from $1.03 billion for the year-earlier period. Net income was $201 million compared to $195 million one year earlier.

"Customers globally are adopting our new Creative Cloud subscription offering more quickly than we projected," said Adobe CEO Shantanu Narayen in a statement.

Small-business financial software vendor Intuit earlier in the week reiterated guidance for growth for the company's current fiscal year, which ends next July. At an investor meeting Tuesday, the company said sales for the fiscal year would increase by 10 percent to 12 percent, totaling $4.55 billion to $4.65 billion. The company forecasts operating-income growth of 12 percent to 14 percent, amounting to $1.315 billion to $1.345 billion.

Reports from software makers have helped keep up investor confidence in tech stocks despite continued uncertainty in the economy. For example, a U.S. Department of Labor report Thursday showed that the four-week average for jobless benefits rose for the fifth consecutive week. However, computer stocks on the Nasdaq are 25 percent higher than they were at the beginning of the year, higher than any other major component of the exchange.

Join the newsletter!

Or

Sign up to gain exclusive access to email subscriptions, event invitations, competitions, giveaways, and much more.

Membership is free, and your security and privacy remain protected. View our privacy policy before signing up.

Error: Please check your email address.
Keep up with the latest tech news, reviews and previews by subscribing to the Good Gear Guide newsletter.

Marc Ferranti

IDG News Service
Show Comments

Father’s Day Gift Guide

Brand Post

Most Popular Reviews

Latest Articles

Resources

PCW Evaluation Team

Luke Hill

MSI GT75 TITAN

I need power and lots of it. As a Front End Web developer anything less just won’t cut it which is why the MSI GT75 is an outstanding laptop for me. It’s a sleek and futuristic looking, high quality, beast that has a touch of sci-fi flare about it.

Emily Tyson

MSI GE63 Raider

If you’re looking to invest in your next work horse laptop for work or home use, you can’t go wrong with the MSI GE63.

Laura Johnston

MSI GS65 Stealth Thin

If you can afford the price tag, it is well worth the money. It out performs any other laptop I have tried for gaming, and the transportable design and incredible display also make it ideal for work.

Andrew Teoh

Brother MFC-L9570CDW Multifunction Printer

Touch screen visibility and operation was great and easy to navigate. Each menu and sub-menu was in an understandable order and category

Louise Coady

Brother MFC-L9570CDW Multifunction Printer

The printer was convenient, produced clear and vibrant images and was very easy to use

Edwina Hargreaves

WD My Cloud Home

I would recommend this device for families and small businesses who want one safe place to store all their important digital content and a way to easily share it with friends, family, business partners, or customers.

Featured Content

Don’t have an account? Sign up here

Don't have an account? Sign up now

Forgot password?