Oracle blames sales force for third-quarter miss, stock drops
SAN FRANCISCO (REUTERS) - Oracle blamed its rapidly expanding sales force for a severe miss in third-quarter software sales and warned that its ailing hardware business will lose more ground this quarter, driving its shares 8 per cent lower on Wednesday.
The world's No. 3 software maker projected a 1 per cent to 11 per cent rise in new software licences and Internet-based subscriptions in the May quarter, an indicator of future performance. But investors focused on a 2 per cent slip in the February quarter that badly missed Wall Street's targets.
Oracle's February quarter revenue miss, which executives blamed poor sales-force performance, was its worst since the November quarter of 2011.
"What we really saw was the lack of urgency we sometimes see in the sales force, as Q3 deals fall into Q4," chief financial officer Safra Catz told analysts on a conference call. "Since we've been adding literally thousands of new sales reps around the world, the problem was largely sales execution, especially with the new reps as they ran out of runway in Q3."