Oracle has been in the news this week after the surprising departure of senior technology executive Thomas Kurian, caused by what is reportedly a disagreement over Oracle's strategy in Cloud. This might put a brighter spotlight on the 9/17 Oracle earnings call, so in preparation we took a deeper look through the Amenity Viewer to identify trends and potential hot button issues.

We focused on recent software earnings calls, which have been mixed, and reviewed the June Oracle earnings call, which looked surprisingly solid through the lens of the Viewer.  We expect Cloud strategy to take center stage, while keeping an eye on the magnitude of FX headwinds.

Recent Trends in the Software Sector

Prior to CRM's earnings release on 8/29, we highlighted a trend in the Amenity Score showing solid results in the software sector, but generally less positive vs prior quarters.  That trend has since continued, highlighted by disappointments from Workday and Guidewire.  

A common theme is FX headwind, which is also likely to apply to Oracle:

• ‍Workday: "We also had very difficult comps the first half of last year, so that impacted the backlog revenue growth.  And we saw some headwinds in Q2 from both duration and FX."
• ‍Adobe: "From a quarter-over-quarter currency perspective, FX decreased revenue by $13.8 million."  
• ‍Salesforce: "Moving on to guidance, let me briefly touch on the FX environment.  As I mentioned previously, we experienced a sequential FX headwind to revenues, and we continue to see some movements in rates.  In context, we are now anticipating an FX headwind to revenue of approximately $75 to $100 million for the remainder of the year.  Despite this FX headwind, we are raising our full year 2019 revenue guidance by $50 million."  

Surprisingly, Oracle's June earnings call was relatively clean

Overall puts and Takes from Oracle's June earnings call

• The Viewer identified fewer positive Financial comments and also fewer positive Product comments.  
• importantly, there were also a lack of significant clusters of negatives, as shown below.  This includes just 2 Deception events vs 11 and 10 in the March and December quarters, respectively.

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This communication does not represent investment advice. Transcript text provided by S&P Global Market Intelligence.

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