Oracle, the leading enterprise software company, said a number of deals to license its products were not closed in the second quarter as revenues for that business failed to reach expectations.

Oracle shares fell more than 4 per cent in after-hours trading on the news, although Safra Catz, chief financial officer, said the deals had not been lost to competitors and were expected to close in the third quarter.

Oracle reported profits in its November quarter rose 21 per cent on a year earlier to $967m as revenues rose 26 per cent overall to $4.2bn. They were boosted by
higher sales of programs and an acquisition spree taking place to improve growth.

“We are now halfway through our five-year plan targeting [earnings per share] growth at 20 per cent per year. For the first two-and-a-half years, we are comfortably ahead of that target,” Ms Catz said.

Larry Ellison, chief executive, said Oracle had a dual strategy of acquisitions and innovation.

He highlighted acquisitions in retail that he said were now starting to pay off. From being on an equal footing with its German rival SAP, Oracle now had the business of eight of the top 10 retailers in the US.

He said the company had not been able to recognise a $10m deal with Wal-Mart in the current quarter, but he expected retail “to move the needle” on revenues in the second half.

Mr Ellison said Oracle’s most interesting new product was Secure Enterprise Search. This would allow workers to use single-word searches to find all relevant information inside and outside their company, from web pages to invoices, e-mails, diary dates,
presentations and databases.

Ms Catz said Oracle was being assisted by a weak dollar against the euro, with around a third of its licence revenues coming from the Europe region.

This had added four percentage points of growth in the second quarter and was likely to add four to five points in the third.

She predicted new software licence revenues would rise 16 to 22 per cent in the third quarter year-on-year, total revenues would rise 23 to 25 per cent and profits would be up by 24 to 29 per cent.

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