Oracle loses $20 Billion in Market Cap. Oracle just doesn’t get it!
Posted on Fri, Dec 23, 2011 @ 04:36 PM
Oracles shares fell as much as 13% as Oracle reported it missed its 2Q earnings and losing $20 Billion of Market Cap and Sun sales were off by 10%.
Oracle said the cause of missed revenue targets was due to a number of deals that were supposed to go through did not, which contributed to a bad quarter.
Analysts tried to come up with a number of reasons including longer sales cycles, cuts in government spending, currency issues, cautious spending due to the economy, European crisis, etc.
Oracle’s sales just might be a reflection of their actions over the past year and not entirely on things they cannot control.
Larry Ellison’s letter to the New York Times regarding HP’s suit against Mark Hurd started a public feud with a 25 year partnership with HP which has been pushed to its limits with Oracle’s $7.4 billion purchase of Sun Microsystems and the withdrawal of support for Oracle software running on HP’s Itanium systems which preceded a lawsuit by HP.
Oracle was also recently fined $200 million by the General Services Administration thanks to a former Oracle employee who blew the whistle on Oracle. Oracle agreed to settle and acknowledge that they made false statements to GSA about their sales practices and discounts (according to the DOJ).
In September, Marc Andreessen said the “Clock is ticking” on Oracle since not a single one of Andreessen-Horowitz’s startup investments use Oracle software. They all use cloud-based alternatives instead.
End-users of Sun products are not pleased at all with Oracle’s changes in policies related to Solaris software and hardware maintenance. The Service Industry Association thanks to the involvement of DJ Pascoe, Esquire the Attorney General of Michigan were able to get Oracle to confirm that Sun equipment purchased after March 16, 2010 were subject to new policies. It’s widely known that Oracle’s changed the ability to acquire Solaris support separate from hardware maintenance and has now tied the two together. In addition, end-users have reported the in order to get Solaris software maintenance, all Sun systems at a facility must be placed under a contract instead of just the systems that are in produc
tion.
Oracle’s termination of OpenSolaris and reversing course to further close Solaris is turning out to be a bad business decision based on the rapidly declining Sun hardware sales. Even employees at Oracle, most likely from the Sun side are disgruntled that Oracle at its core has no empathy. It’s reported that a disgruntled employee has leaked the Solaris 11 code.
The Wall Street Journal reported that big brand-name companies have been hiring abroad while cutting back at home. Oracle has 62.9% of its workers overseas which is a 315% increase since 2001.
American’s don’t like big American Corporations that are only concerned with their own financial greed. We just saw witnessed 3 months of Occupy Wall Street Protesters in many cities.
Oracle is a poster child for what the Occupy Wall Street Movement is about. Oracle hires overseas while displacing American workers, competes with its partners, makes its software proprietary to increase profits, and based on the settlement with GSA is involved in poor business ethics.
Could this be the real reason Oracle had a bad quarter or is Oracle correct, that it’s based on deals that just didn’t close in time?