Hewlett-Packard? They’re just a minor roadblock, according to Oracle CEO Larry Ellison.
After easily beating the expectations of many analysts with its most recent earnings report, Oracle is setting its sights on capturing market share and claiming HP’s spot of number two database hardware and software provider behind IBM.
Net income for Oracle jumped 28 percent to $1.87 billion in its second quarter of 2011, up from $1.46 billion in the same quarter a year earlier, according to its most recent financial statement. Oracle’s operating revenue also rose 47 percent to $8.6 billion in its most recent quarter, compared to $5.9 billion in the same quarter a year earlier.
Oracle continues to successfully fend off the public cloud (which allows developers and companies to offload storage and heavy-duty computing to remote servers at a lower cost) said Oracle president Mark Hurd on the company’s earnings conference call. Some of its servers and accompanying software can cost upwards of $1 million. But the strategy seems to be working. Its most recent line of servers and software is able to run more than 30 million online transactions per minute, shattering the previous record of 10 million transactions per minute set by IBM.
“We expect overall that our new generation of SUN machines, Exadata, Exalogic and SPARC will enable us to win significant share in the high-end server market,” Ellison said. “That will put us in the number 2 position very soon behind IBM, then we’ll fight it out for the number 1 spot.”
Despite the popularity of the public cloud, servers and databases that are run in-house are usually faster and easier to access. A number of security concerns prevent some of the largest companies in the world — big targets for Oracle’s hardware and software products — from jumping on board the public cloud. Those are companies that can afford the massive price-tags of Oracle’s software and hardware and have the staff to install and maintain them.
HP, which is second in market share at this point because of its legacy in servers, came a distant third in speed with 4 million transactions per minute, Ellison said. Despite the presence of former HP CEO Hurd on the conference call, Ellison did not mince words when it came to HP’s servers. He said they were downright terrible when compared to Oracle’s new products and IBM’s servers and software.
“HP’s servers are slow, expensive and have little or no software, that makes them vulnerable to market share,” Ellison said. “All our new servers are engineered to run databases and middleware faster than HP and IBM.”
But even with its success with on-premise database hardware and software, Oracle isn’t going to shy away from the public cloud. It’s releasing a suite of applications called Oracle Fusion that can run on in-house hardware and public cloud servers. Ellison said he expects it to compete with Salesforce and other public cloud applications beginning next year.
“You’re just seeing the beginning of us getting share in applications,” he said.
Investors loved the news, sending Oracle’s shares up about 4 percent to $31.45 in extended trading.