Sun Microsystems Inc. has reported a $147 million loss for the April-June quarter. This is likely the last quarter that the company will have before being absorbed by Oracle. Oracle agreed to buy out Sun for $7.4 billion back in April, but the deal is pending approval from European antitrust regulators.
The numbers were reported on a regulatory filing but there wasn’t a news release or conference call. Sun Microsystems invented the JAVA programming language which is a key component for the web, PC applications, and mobile applications.
About a year ago during the same quarter, Sun had a profit of $88 million. Revenues for this past quarter was $2.63 billion. The year before, sales were $3.78 billion. Thomson Reuters analysts expected revenues to be $2.37 billion for the quarter.
“We are definitely not going to exit the hardware business. While most hardware businesses are low-margin, companies like Apple and Cisco enjoy very high-margins because they do a good job of designing their hardware and software to work together. If a company designs both hardware and software, it can build much better systems than if they only design the software. That’s why Apple’s iPhone is so much better than Microsoft phones,” stated Larry Ellison in an interview with Reuters that was filed with the SEC.
Despite Oracle’s $7.4 billion acquisition of Sun Microsystems, CEO Larry Ellison insisted that his company will remain in the hardware business. When Oracle bought Sun, they were primarily interested in the way that Java and Solaris software interacted with their hardware.
Many analysts believed that Oracle would focus more on software after buying a company whose core products revolve around software and online databases. Oracle also plans to invest more in Sun’s Sparc microprocessors. Oracle believes designing their own chips is becoming increasingly important just like Apple is beginning to do.
“Sparc machines are much less expensive to run than Intel machines,” added Ellison.
[Updated 9:22 AM EST - Both companies appear to be fixed during the pre-market, Intel is at $15.76 and Oracle is at $19.45]
In September 2008, Google stock appeared to be trading at $0.01 temporarily when it should have been over $400. The glitch had to be investigated by Nasdaq Stock Market operators and it resulted from erroneous orders that were routed from another exchange. This time it looks like a similar case is happening with Intel Corporation (NASDAQ:INTC) and Oracle Corporation (NASDAQ:ORCL).
In the after hours stock price, Intel is reporting a $7.91 per share which is -49.52% from the closing price. Oracle is showing an after hours stock price of $9.63 per share which is -49.77% of the closing price. When this happened with Google last time any trades that took place at the $0.01 price were automatically canceled was not allowed to be appealed. As exchanges are becoming all-electronic they are susceptible to problems.
If anyone has any additional information, please let us know in the comments.
After IBM recently backed out of making a deal with Sun, Oracle stepped up to the plate and bought out the Java-making company for an astonishing $7.4 billion. IBM’s offer was about $6.5 billion.
This will give Oracle the opportunity to become even more competitive against IT firms such as Hewlett-Packard, IBM, SAP, etc. Sun also holds the assets to two of the most impressive pieces of software Java and MySQL.
“To me, this proposed acquisition totally redefines the industry,” wrote Sun President and CEO Jonathan I. Schwartz in an e-mail to Sun employees. “Let me assure you [Oracle is] single minded in [its] focus on the one asset that doesn’t appear in our financial statements: our people.”
Oracle will be paying $9.50 per share for common stock in Sun, but the agreement is subject to the Justice Department’s approval. Sun was founded by Vinod Khosla, Andy Bechtolsheim, and Scott McNealy. Oracle was co-founded by Lawrence (Larry) Ellison.
“Java is the single most important software we’ve ever acquired,” stated Ellison in a conference call. “With the acquisition of Sun, Oracle is now able to make all of the pieces of the technology stack fit together and work well.”
Oracle Corporation (NASDAQ:ORCL) announced yesterday that they would acquire Captovation, an Eden Prairie, Minn. company that focuses on web document capture. Oracle plans to expand its enterprise content management line. The financial details were not released on the acquisition. Captiovation will become a part of Oracle’s Fusion Middleware product. Oracle acquired, Stellent, a content management application vendor last year for $440 million. Oracle is also in the midst of acquiring BEA Systems for $8.5 billion.
Oracle’s Senior VP of server technologies, Thomas Kurian stated that Captovation’s technology will help the company’s customers handle regulatory requirements and auditing processes. In the last 3 years, Oracle has spent roughly $25 billion in acquisitions.
“By adding document capture to Oracle’s leading content management, process automation and back office applications, Oracle will be the only vendor that can provide customers with a fully integrated solution for automating back office operations,” stated a company rep at Oracle.
On Friday November 3, 2006, The Wall Street Journal stated that David A. Duffield, the founder of PeopleSoft Inc., a company that was acquired by Oracle Corporation in 2004, will “announce a new company called Workday Inc.” on Monday November 6, 2006.
What I’m confused about is that WorkDay Inc. already appears to have a website and the Wall Street Journal article also states “Workday, founded in March 2005, will initially offer services designed to help companies manage human-resources tasks.” How could they announce a new company on Monday when the company has existed since 2005?
I suppose the article just means that the company will be shifting business strategies. The products that WorkDay offers right now is ERP systems that revolve around Human Capital Management, Finance Management, Resource Management, and Revenue Management. WorkDay Inc. will “initially offer services designed to help companies manage human-resources tasks, but it plans to later branch into other areas such as finance, the company said in a Nov. 1 press release” stated the Wall Street Journal. “In the call, Mr. Duffield described the business as “a new generation of on-demand ERP.”
For those who are not familiar with ERP (electronic resource planning) systems, refer to the Wikipedia page.
