It's time to look at the Oracle (ORCL) trailing 12 months revenue flow. Based on Oracle's off-quarter and off-calendar fiscal reporting, the 12 months ending February 28 of any given year are the "Oracle months" that most look like a calendar year. And therefore mimic the calendar-year dynamics -- be it SAP's and IBM's December hockey stick or Microsoft's (MSFT) holiday-season sales.
These four companies make up 75% of the software market so that's all you need right. Well yes and no. There is nothing simple when it comes to Oracle comps. Oracle's off-calendar and off-calendar nature is the least complicated thing to deal with.
First, it's all those acquisitions that really screw things up. Some investors want to see Oracle backcast (look in the Oracle 10-K proforma section but that's done only once a year), because that's most indicative of overall market dynamics. Others want to see Oracle GAAP because that's most indicative of whether the financials are working out the way Safra said they would (they always do!). And now an increasing number of investors want to see the big picture because -- hey -- maybe there is something to this "attack IBM" thing.
Second, in other words it doesn't matter anymore that Oracle is number two or number three in the software market. Oracle itself even mixes up its software revenue, counting some of its software in the two heritage "software" line items on its income statement (new, and updates/support), counting some of it in the "OnDemand" line item on its income statement (as has been true at least since the acquisition of Siebel), and now counting some software in the new (since March 2010) Hardware Systems Products line item. The exact wording is:
"Our hardware systems products consist primarily of computer server(s) and storage product offerings and hardware-related software, including our (Sun Microsystems') Solaris operating system."
And of course there are a few of you who still want to see how what's left of BEA middleware is doing against IBM Websphere, and what's left of PeopleSoft ERP is doing against SAP R/3.
I hate to tell you this but if you're in the latter group, you're dinosaurs like me.
-- Dennis Byron