Oracle's FQ2 shows total software/cloud revenue rose 5% yr/yr in FQ2 to $7.3bn, in-line with expectations and with a guidance for 3%-6% growth. However, hardware system revenue also grew 1% to $1.3B, beating guidance for flat to -10% growth. EMEA sales were up +3% to $2.9bn.
SaaS, (cloud app), PaaS (cloud app platform), and IaaS (cloud infrastructure) revenue collectively rose 45% to $516M; guidance was for 39%-44% SaaS/PaaS growth and 39%-43% IaaS growth. On the other hand, traditional software license revenue remains pressured by the cloud migration, it fell 4% to $2.05bn. Services revenue fell 3% to $935M.
License update/product support revenue (50% of revenue, driven by past deals) rose 6% to $4.8bn. Sales/marketing spend only rose 1% to $19bn; R&D rose 9% to $1.39bn.