Oracle - Earnings Call - Q2 2012

Transcript

Speaker 7

Good day, everyone, and welcome to today's Oracle Corporation Quarterly Conference Call. Today's conference is being recorded. At this time, I would like to introduce Ken Bond, Vice President of Investor Relations, Oracle. Please go ahead, sir.

Speaker 0

Thank you, Amber. Good afternoon, everyone, and welcome to Oracle's second quarter fiscal year 2012 earnings conference call. A copy of the press release and financial tables, which include a GAAP to non-GAAP reconciliation and other supplemental financial information, can be viewed and downloaded from our Investor Relations website. On the call today are Chief Executive Officer Larry Ellison, President and CFO Safra Catz, and President Mark Hurd. As a reminder, today's discussion will include forward-looking statements, including predictions, expectations, estimates, or other information that might be considered forward-looking. Throughout today's discussion, we will present some important factors relating to our business, which may potentially affect these forward-looking statements. While these forward-looking statements represent our current judgment, these statements are also subject to risks and uncertainties that may cause actual results to differ materially from statements made today.

As a result, we caution you against placing undue reliance on these forward-looking statements. We encourage you to review our most recent reports, including our 10-K and 10-Q and any applicable amendments, for a complete discussion of these factors and other risks that may affect our future results or the market price of our stock. Finally, we are not obligating ourselves to revise our results or publicly release any revisions to these forward-looking statements in light of new information or future events. Before taking questions from the audience, we will begin with a few prepared remarks. With that, I'd like to turn the call over to Safra.

Speaker 3

Thanks, Ken. I'm going to focus on our non-GAAP results for Q2. I'll then review guidance for Q3 and turn the call over to Larry and Mark for their comments. This quarter, new software license revenue was $2 billion, up 3% in constant currency, or 2% in U.S. dollars, building off a 21% increase from last year. This was a result of a few things. First, in the last few weeks, really in the last few days of our November quarter, for the first time in a while, in some regions, we saw an increase in last-minute additional approvals required for previously scheduled and expected deals. As a result, we are putting in place better deal management so that we have the time and the approvals necessary to take this into account.

Additionally, there was a 2% negative swing as the 1% currency tailwind included in our September guidance shifted to a 1% headwind for new software license. Technology new license revenues were $1.5 billion, up 4% in constant currency and U.S. dollars. Applications were $569 million, off 1% in constant currency and 2% in U.S. dollars. Within application revenue, ERP and CRM grew very well. Geographically, results were mixed, as Latin America and Asia Pacific, excluding Japan, did well in constant currency in most products, consistent with the growth in their economies, while the U.S., Europe, and Japan were up a bit, flat, or down. As I mentioned earlier, currencies moved a lot in different regions. In license, we saw a total new license growth rate of 1% in constant currency, or flat in U.S. dollars in the America, and up 3% in constant currency, or 2% in U.S.

dollars in EMEA, while we saw 8% growth in Japan in constant currency, or 11% in U.S. dollars. The quarter was not dependent on any large deals. Software license and product support revenues were $4 billion, up 9%. Support attach rates and software renewal rates continue at usual high levels. Hardware systems revenue was $953 million for the quarter, due in part to a product transition to T4 processor-based products, as some customers moved to qualify the new servers and significantly slowed buying the older systems. We saw good early demand for the new SPARC SuperCluster, but only released the products for general availability at the very end of the quarter, allowing us to ship only a couple. In sharp contrast, Exadata and Exalogic growth saw significant acceleration this quarter, with triple-digit growth rates over last year's Q2. Hardware gross margins were 51% for the quarter on the lower volumes.

Total revenue for the quarter was $8.8 billion, up 2% in constant currency and U.S. dollars. As for expenses, it was not a perfect comparison, as in last year's number, we got the benefit of $120 million in G&A expense reduction as a result of SAP's expense reimbursement for settling a small part of our intellectual property theft lawsuit against them. Net of that, G&A was flat. We're pleased with our non-GAAP operating income of $3.9 billion, up 3%, as we expanded operating margins to 45%. We believe there remains ample leverage in our business model, and we believe we could be back at pre-Sun operating margins shortly. The non-GAAP tax rate for the quarter was 26.3%. EPS for the quarter grew 6% to $0.54 on a non-GAAP basis.

Operating cash flow increased to a record $13.1 billion over the last four quarters, while free cash flow grew 45% to a record $12.6 billion. We now have over $31 billion in cash and marketable securities. We remain committed to returning value to our shareholders through technical innovations, strategic acquisitions, stock repurchases, and prudent use of debt and dividends. This quarter, we repurchased 33.1 million shares for a total of $1 billion. We have received an additional $5 billion in authorization for our stock buy program, and the board again declared a dividend of $0.06 per share. Now to guidance. As you remember, we had an absolutely stunning third quarter last year, with new license up 29% and non-GAAP EPS up 40% and GAAP EPS up 75%. Regardless, the fundamentals of the business remain strong, with pipelines growing significantly.

I do read the daily financial news, so I'm going to take that into account for this quarter's guidance. With currency bouncing around, I'm going to give you constant currency guidance. As a convenience for you, I'll give what our U.S. dollar rates from the past few days. That currently amounts to about a negative 2% currency effect on license growth rates and on total revenue growth rates. Rates remain very volatile. Our guidance for Q3 is as follows: New software license revenue growth is expected to range from 2% to 12%. That's from positive 2% to positive 12% in constant currency and 0% to 10% in U.S. dollars. Hardware product revenue growth rate is expected to range from negative 4% to negative 14% in constant currency, or negative 5% to negative 15% in U.S. dollars. That does not include the hardware support revenue.

Total revenue growth on a non-GAAP basis is expected to range from 3% to 7% in constant currency and 1% to 5% in U.S. dollars. On a GAAP basis, we expect total revenue growth from 4% to 7% in constant currency and 2% to 5% in U.S. dollars. Non-GAAP EPS is expected to be $0.56 to $0.59 in constant currency and $0.55 to $0.58 in U.S. dollars, up from $0.54 last year. GAAP EPS is expected to be $0.44 to $0.47 in constant currency and $0.43 to $0.46 in U.S. dollars, up from $0.41 last year. This guidance assumes a GAAP tax rate of 26% and a non-GAAP tax rate of 26.5%. Of course, it may end up being different. With that, I will turn it over to Larry for his comments.

Speaker 0

Thank you, Safra. This past Q2, Oracle sold over 200 Exadata and Exalogic engineered systems. In Q3, we plan to sell over 300 Exadata and Exalogic engineered systems. In Q4, we plan to sell over 400 Exadata and Exalogic engineered systems. That would make our annualized Q4 engineered system sales approximately $1 billion. We plan to double those sales again next fiscal year. As our engineered systems business gets larger, it will drive revenue growth in our overall hardware business. In Q2, we won some competitive deals because our engineered systems deliver much higher performance than IBM's fastest P-series computers. In Q2, we won other competitive deals because our engineered systems delivered much better cost performance than commodity Intel servers. I'm going to start with Exalogic, the newer of our machines, and talk about a few deals we won.

At the University of Melbourne, they bought four Exalogic systems running our Fusion middleware, where we beat Cisco Intel servers running VMware because the Exalogic systems were a lot faster and a lot more cost-effective. It's both. It was cost performance that won us that deal, not peak performance. We won an Exalogic deal at the Food and Drug Administration, the FDA. They bought five large Exalogic systems, full racks, to add on to their existing Exadata systems. They are standardizing now for a series of applications, including identity management and a bunch of custom applications. They're standardizing on Exadata and Exalogic. Amway bought two Exalogic systems, replacing IBM AIX on P-series machines. The e-business suite, the Oracle e-business suite, ran 12 times faster on the Exalogic machines than on the IBM P-series.

Their custom, that's Amway's custom OLTP applications, which were solo Java applications, ran 10 times faster than on IBM P-series machines. I know IBM is running a lot of ads saying they run faster, that their machines run faster than ours. I'd love to see their customer references because we haven't seen one. We've seen a lot of ads, no customer references. We have lots and lots of customer references where we're replacing P-series and running much faster than IBM. I'd like to see one from IBM. Hyundai Motors, Hyundai Kia Motor Company, bought an Exalogic system. This was our first win in an account that has been a loyal IBM customer for more than 20 years. Exadata. Exadata came out quite a bit before our Exalogic machines. Some customers are beginning now to standardize on Exadata.

A very large American smartphone manufacturer now has over 30 Exadata systems as they build their cloud. A large European bank has over 24 Exadata systems. AC Nielsen moved their Walmart data off their IBM computer onto an Exadata machine, where it ran queries 10 times faster. 10 times faster. We found four SAP customers moved their data onto Exadata to run their SAP ERP systems, and we're seeing huge performance gains as they move off conventional servers. At least one of those deals was competitive against SAP HANA. As Safra mentioned, our SPARC SuperCluster was delivered during the last week of the quarter, where Macy's bought two SuperClusters, and the state of California bought one. Mark, turn it over to you.

Speaker 6

Yeah. First, Larry, you talked about Exadata. I thought I'd just put some numbers around. First, it was just a very strong Exa quarter. Our bookings for Exadata were a record. That includes Q4 of last year. The pipeline is the biggest we have ever. We had the largest number of wins from new customers in Q2. Exalogic is ramping faster than Exadata. Sales more than doubled sequentially. The first-year sales for Exalogic are more than double the first-year sales of Exadata. At Oracle OpenWorld, we announced two more Exas, Exalytics, and the Oracle Big Data Appliance, in addition to the SPARC SuperCluster that we just mentioned. We are now winning with Fusion apps in the cloud. We won Brocade, Living Social, and Rainbow Media in the quarter. 100 apps now available cloud or on-premise. We believe this to be a key differentiator.

As Larry mentioned, let me add that we have put 1,700 incremental sales resources into the field since the beginning of the fiscal year. We have shown strong expense discipline while adding these resources, while increasing our margins. Great new products and more sales resources drive more organic growth. On hardware, our introduction of the T4 and SSC have driven material. SSC for us is SPARC SuperCluster. It's driven material pipeline for the back half of the year. Safra mentioned the T4 hurt a few orders for us in Q2. The pipeline has grown materially. These are the most exciting SPARC products we have had in years. ZFS storage doubled year over year. This is the fourth quarter of consecutive growth for ZFS in a row. As we start lining up these pieces of differentiated IP aligned with incremental sales resources, we will drive yet more growth.

With that, I'll turn it back to Ken.

Speaker 0

Amber, if we could begin the Q&A portion of the call now.

Speaker 7

Thank you, sir. If you would like to ask a question, please signal by pressing the star key followed by the digit one on your telephone keypad. If you're using a speakerphone, please make sure your mute function is turned off to allow your signal to reach our equipment. Once again, that is star one to ask a question. We'll pause for a moment to assemble the queue. We'll take our first question from John Stephen DiFucci with JPMorgan.

Speaker 1

Thank you. The question has to do with the general backdrop here. It looks like the Americas had a very difficult comp this quarter. It doesn't get any easier next quarter. EMEA had a relatively easy comp this quarter that actually gets more difficult next quarter. The Asia Pac comp gets a little more difficult, too. I guess, Safra, with the guidance, how do you get comfortable? How do we get comfortable with your guidance? You obviously see a lot more than we do in the numbers and where it's going. You've given guidance that, at least from our calculations, is a little better than normal seasonality from this quarter to next, realizing this quarter was a little bit below what you had anticipated at the beginning of the quarter.

Speaker 3

There are a few things. The first one is clearly this quarter was not as we thought it would be. We've been taking a look at the deals that really should have closed and that would have closed, but for sort of a regular environment. A number of them have closed or are on track to close this quarter. We feel very good about it. We've expanded our distribution capacity enormously, so we have a lot more feet on the street. We're looking at really the business overall. Though I'm trying to bring in some level of conservatism because of just what I read about the economy, we are really comfortable that we will get there, that we should be there. There's no, I mean, I suppose if there's a giant global financial meltdown, we shouldn't. In looking at what happened this quarter, we don't actually expect that to repeat.

I think we'll have a much more normal next quarter. As I said in the beginning, we've put in some measures so that we can monitor really what's going on and make sure we are on time with the appropriate approvals. Mark, do you want to add to that?

Speaker 6

Solid pipeline, John. It's quite strong. We're not forecasting, you know, a higher, if you will, conversion rate, if you think of it, from a pipeline perspective. To Safra's point, we have more resources. I think the combination of that aligned with our product portfolio. Our product portfolio is just, you know, John, I don't know how else, you know, I think we've talked about it before. We just have the best lineup of products in the industry right now. When you look across the apps portfolio, remember, we're going to market now with an apps portfolio. It's only been refreshed over the past two or three months. You go to the T4 processor SPARC SuperCluster product line. Those were just released at Oracle OpenWorld. Larry talked a lot about the Exadata. I added on the Exalogic numbers from a momentum perspective.

You've got the lineup of product line, strong pipeline, and more resources. We have confidence.

Speaker 1

Mark, those new procedures that were put in place to sort of keep track and make sure these deals close, Safra mentioned that some of these deals have closed. Have they sped that up? Has that given you, also given you sort of the confidence?

Speaker 6

I'm not going to talk about what's going on in Q3. This is a Q2 call. Obviously, we get to look at a lot of deals. This is the life we chose, though, in the context that there are always going to be big deals. It's our job, obviously, to get about the job of getting them called. We get a pretty good view of them. We feel good about the momentum that we've got. I really have to fall into those key categories, which are, how's your product lineup? How's your sales resource lined up? How is the pipe? We need pipe, obviously, going into the quarters. That's obviously our preliminary indicator. Those are the basic fundamentals behind the guidance, John.

Speaker 0

Thank you.

Speaker 7

We will go next to Heather Bellini with Goldman Sachs.

Speaker 5

Hi. Thank you, and good afternoon. I wanted to follow up, Safra and Mark, you guys mentioned that in your comments to John about how you've been hiring aggressively. I think you mentioned you've hired about 1,700 people since the start of the fiscal year in your press release. Can you talk about, Safra, how you think about balancing kind of your EPS goals? I'm not talking about November, but just as you look going forward out over the next few quarters or next year, how do you think about balancing your EPS goals with the demand opportunity you see in front of you based on the pipeline and the product lineup that you have?

Speaker 3

You know, with us, it's always, you know, we're always very EPS protection-driven. If markets are more difficult, we're always the ones who are somehow able to bring in the EPS as a general matter. We've taken a little bit of a lesson from this quarter, and we'll continue to monitor. Remember, a lot of this is our new product updates and support, product support and updates business. The overall business gets bigger. That is, of course, very profitable for us, and we think we can grow profitably. I want to point out that even in this quarter, our operating margins increased, OK? Even in a quarter where we did not actually end up selling as many new licenses as we'd hoped, our operating margins increased.

We are really on track to get back to our pre-hardware company margins, which puts us, of course, as still the highest operating margins in the software industry. We have a $4 billion hardware business in us. I would bet on us to keep those earnings growing and protected.

Speaker 6

Heather, just to follow up too, the 1,700, I want to make sure you're clear, is a net number.

Speaker 3

Right.

Speaker 6

We didn't hire three. OK, that is a net number minus attrition, 1,700 more people calling on customers. To Safra's point, we've been very disciplined. Our margins went up while doing that. To your point about protecting EPS, it is foremost in our mind to make more money while we do this.

Speaker 5

Great. Thank you.

Speaker 7

We will go next to Cash Rangan with Bank of America Merrill Lynch.

Speaker 4

Hi. Thank you very much. Larry, obviously, sounds very bullish on engineered systems. Mark, you sound bullish on distribution. Yet the only thing that we're also scratching our heads with is the applications license number. You obviously sound pretty confident that the business will rebound in the February quarter. Just wondering if you can give us a little bit more color. Is it financial services, public sector, some of the verticals that are talked about within apps that is where you saw the pause? Maybe you could take a vertical cut at it. I know you have a strong presence in industry vertical solutions. Is it where you saw the pause? Consequently, what gives you the confidence that we might see a snapback in spending if this hypothesis is correct that it was narrow, that the weakness in applications license was narrowed to a few pockets? That's it for me.

Thank you.

Speaker 3

Where we saw real strength is in CRM, where we were double-digit growth, close to 20%. ERP did very well. However, where we had some weakness was in some of our vertical markets, which are longer sell cycles and which need to be managed very, very carefully. We think those are actually going to recover. I will tell you that generally, in public sector, we are actually doing reasonably well in the U.S. public sector, as they're very good customers for our engineered systems and things like that. I think we actually expect a snapback more as we get into more regular management of those deals in the vertical markets, which are generally long sell cycle, larger deals have to be managed well.

Speaker 4

Thank you.

Speaker 7

We will go next to Philip Winslow with Credit Suisse.

Speaker 2

All right. Thanks. Just two quick questions. First, for Safra and Mark, could you maybe talk about just the dynamics between the applications and the database and middleware businesses in terms of live revenue, and kind of how you're thinking about that when you put together your guidance for next quarter for acceleration and live revenue growth versus this quarter? Just kind of maybe compare and contrast the two. To Larry, one of the things you mentioned was.

Speaker 0

Phil, I'm going to jump in here. We need you to speak up.

Speaker 3

I'm sorry. Phil, we couldn't quite catch the question. Maybe you could talk closer to your phone.

Speaker 2

All right. Thanks. Sorry about that. I was wondering if you could just compare and contrast the database and middleware and then the applications businesses just in terms of your guidance for next quarter and just the business trends that you're seeing there and how you kind of think about that rolling forward. I'll follow up for Larry. In terms of HANA versus Exadata, you mentioned a win there directly versus SAP. I wonder if you could just give us your thoughts on that. Thanks.

Speaker 3

OK. In general, we expect both database and applications to be strong next quarter, actually. The reality is that we've got extremely difficult comparisons, frankly, in both and in database particularly. We do expect, obviously, a significantly better quarter in Q3 across the board. Larry?

Speaker 4

There were a series of benchmarks at a customer where they compared HANA, SAP's in-memory analytical database. They compared the performance of that against just our Exadata database machine. Exadata was faster, which I think surprised a lot of people because Exadata is not what we line up against HANA. That is not our product that we line up against HANA. We have a product called Exalytics, which is our in-memory analytic database. It was interesting that our database machine, which is a combination of memory, flash, and disk, outran HANA without Exalytics. With Exalytics, we're 10 times again faster. We're fairly confident that if Exadata can beat HANA, Exalytics will beat HANA by even more. That came as a surprise to us.

Speaker 2

Great. Thanks, guys.

Speaker 7

We will go next to Adam Holt with Morgan Stanley.

Speaker 1

Hi. Thank you. My question is about the hardware business. It sounds like you saw a little bit of a product transition this quarter in the hardware business. Is the assumption in the guide that that continues for the third quarter? Still pretty confident that the hardware business can grow into the double digits, even as potentially the macro environment gets a little bit softer into the next year?

Speaker 4

Yeah. We are going through a transition. The transition, we went through a microprocessor transition where it all begins as we introduced T4. Some people were looking at buying T3, delayed and qualified T4, and are buying T4. I think that hurt us a bit in, that definitely hurt us a bit in Q2. We think that's going to help us a bit in Q3 and help us even more in Q4. SPARC SuperCluster, again, we just were able to deliver right at the end of the quarter. We think that's going to, we are going to start selling that aggressively into the installed base, the Sun installed base. We already have a very large pipeline for that. On top of that, the big thing, the thing that really moves the needle, our Exadata and Exalogic have been out there for a while.

As I said, we sold 200 last in Q2. We'll sell 300 in Q3. We'll sell 400 in Q4. It's very easy to remember. Q2, 200, right. 3, 300, 4. We didn't plan it that way, but that's the way it's turning out. As that becomes a larger and larger percentage of the total, I mean, clearly, that's going to drive two things. It's going to drive top line. It's going to drive margin. We think that's what we think the hardware business could turn around and show growth as soon as Q4. We will definitely go, I think, I'm very confident it will show double-digit growth next year because we'll have all of these new products out. I'll let Mark come.

Speaker 6

I had a couple. I mean, I think one, that the T4 migration from T3 was a big jump. You're talking about 2.5 times the performance on the microprocessor. You could not upgrade in box. That's a big deal to customers that when I buy something, I got some, I've got a migration path, which we will have with T4 to T5. We have a T5. The range of products now coming out gives us a different position in the market. The fact that next year when T5 comes out, you'll be able to upgrade from the T4 to T5. That will sort of eliminate some of this pause that you just heard us describe. If I bought a T3, I have to do a complete replacement to get to a T4.

These are just the things you have to do as you start to improve the IP and the product line. You've seen us improve ZFS. You've seen us do it with T4. You see that now manifesting itself in servers out there. You're going to see it show up in what we've done in tape earlier in the year. We've refreshed the product line. This is all separate from Exa. We've put more feet on the street. We feel very good about our competitive position. Yeah, that's where we are.

Speaker 0

That's very helpful. Thank you.

Speaker 6

Thank you.

Speaker 7

We will go next to Brent Bill with UBS.

Speaker 4

Thanks. Mark, just on the sales capacity adds, you've been quite aggressive. Does Q2 give you pause to potentially slow that a little, or are you still aggressively moving forward?

Speaker 6

No, no. I think we would continue to be aggressive where it makes sense. Listen, we're in a unique position. We're one of those companies people want to join. Salespeople want to be part of companies that have great products, that have a great market position. We have to make sure, to your point, that we're hiring the right ones. That's what we're doing. We're trying to be very particular that we're getting the right folks. Of course, to your point, we're trying to make them productive and put the kind of infrastructure in to assimilate and get them productive as quickly as we can. We're going to be very, very aggressive at looking for good talent. I want to make sure I add the point that was mentioned earlier within the context of disciplined expense management.

We feel like we need more distribution, and we're going to continue to try to get it.

Speaker 4

A quick follow-up for Safra, just on the additional approvals that you needed. Was the common characteristic they just needed more time? Are you starting to see some of the customers come in and talk about some of their budgets being a little more constrained and they're downsizing some of their projects?

Speaker 3

You know, we haven't seen what you said, the second half of what you've seen, which is downside thing. What we did see was folks where all of a sudden the CEO had to approve it or something like that, where before it was, you know, it was all set. We haven't had them come back and tell us their budgets are down or anything. As I said, in some cases, things closed literally the next day or a few days later once the approval came in. You know those things, when we do run them sometimes right to the end, you just run out of time. We've seen this before. I think that we can manage it now that we understand it and that we put it into the process again. I think we've got it handled.

Speaker 4

Thank you.

Speaker 7

We will take our final question from Rick Sherlund with Nomura.

Speaker 6

Thanks. Larry, could you reconcile the numbers you gave for Exadata and Exalogic? I think it adds up to 1,000 or 1,100. Didn't you say 3,000 just recently? I think the company originally got it to 2,000.

Speaker 4

Yes, that's right.

Speaker 6

Could you elaborate? Is it turning out to be a harder sell? Are you trying to figure out how to sell it, or?

Speaker 4

I think we're going to be, we're growing Exadata about, you know, let's see, the growth rate is around 150%. Exadata and Exalogic even faster.

Speaker 6

Yeah, go ahead.

Speaker 4

Rick, make sure you're clear. What Larry said earlier was tripling the growth.

Speaker 6

It stalled.

Speaker 4

Tripling and stalled it.

Speaker 6

Driving that. That's the same metric we're on. You're hearing the same number within the context of a different way of describing it. Let me make sure you're clear, Rick. There is no more difficulty in selling Exadata. There is no issue with pipeline. It is quite the opposite. We're also comparing what we bolt versus what we ship. There are a couple of different numbers that are running around here. We are going after that same metric that Larry described before. You are seeing probably not anything more than us now manifesting that sell in quarterly numbers that are coming out. It's very positive. I think the biggest news within it is no change in the Exadata trajectory. I don't want to say this is a surprise.

The speed of the Exalogic ramp is probably the, it may not be a surprise to Larry as he's nodding his head a bit. It is very, very positive. We are seeing a faster ramp of Exalogic than we did Exadata. Mark, I still don't understand. Are you talking about selling?

Speaker 4

Rick, if your question is, you know, we set a goal of tripling the installed base. That was our goal. We probably won't triple it. We'll probably increase it by 2.5 times. If that was your question, are we going to triple? You added up the numbers and said it looks like it's going to be more like 2.5 than triple. That's right. We're only going to grow it by 2.5 times. We said we had a very aggressive set of targets. We are taking huge amounts of share from IBM at their high end. We're taking share from Teradata and Netezza, everybody. This business, again, will be at a $1 billion run rate if you annualize our Q4 numbers. It will be $2 billion the following year. Will we have hit our units tripling? No, we'll probably fall a little short of that.

Speaker 6

We got a shot.

Speaker 4

We got a shot.

Speaker 6

Yeah.

Speaker 4

We still have a shot.

Speaker 6

Yeah.

Speaker 4

I mean, we could. Yeah, exactly.

Speaker 6

Yeah.

Speaker 4

I mean, listen, you're into the internals of our customers.

Speaker 6

We're in that range. This is what's an exciting opportunity for us. We're not out of doing that tripling yet. The color that, I mean, will the results for Exadata and Exalogic be stellar and extraordinary or merely spectacular? We might just be spectacular. You caught us, Rick.

Speaker 0

Operator, we can wrap the call.

Speaker 7

Thank you. At this time, I would like to turn the conference back over to your speakers for any additional or closing remarks.

Speaker 0

Right. Thank you, Amber. A telephonic replay of this conference call will be available for 24 hours. Dial-in information can be found in the press release issued earlier today. Please call the Investor Relations Department with any follow-up questions from this call. We look forward to speaking to you. Thank you all for joining us on today's conference call. I will ask the operator to close the call.

Speaker 7

That does conclude today's conference. Thank you for your participation.