Oracle's (ORCL) Buying Binge To Turn Toward Chip Companies
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Price: $182.81 -9.17%
Overall Analyst Rating:
SELL (= Flat)
Dividend Yield: 0.7%
Revenue Growth %: +27.5%
Overall Analyst Rating:
SELL (= Flat)
Dividend Yield: 0.7%
Revenue Growth %: +27.5%
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Oracle Corp. (NASDAQ: ORCL) chief executive officer Larry Ellison said that his company will not follow the latest technology market trend by buying service companies, while instead look to get into semiconductor or software companies.
Ellison's comments Thursday at the Oracle OpenWorld conference indicated that the company will buy a semiconductor company with technology for servers.
Possible targets include Advanced Micro Devices Inc. (NYSE: AMD, the chip business of International Business Machines Corp. (NYSE: IBM) and NVIDIA Corp. (NASDAQ: NVDA).
"You're going to see us buying chip companies," Ellison said. "We want to play in every important industry."
Oracle jumped deeper into the hardware business with its acquisition in January of server manufacturer, Sun Microsystems Inc.
Oracle is the world's second-largest software company, having $23.6 billion in cash and short-term investments at the end of its most recent quarter. Adding to the speculation that the company will go deeper into hardware, it hired former Hewlett-Packard Co. (NYSE: HPQ) CEO Mark Hurd.
The company is looking to double the size of its hardware business, which generated $1.7 billion last quarter.
"I would be stunned if 10 years from now, most data centers didn't rely on these engineered systems," Ellison said. "We're betting that this is the future of computing."
The comments are driving shares of AMD (NYSE: AMD) up 5.5 percent and NVIDIA up 2 percent. In addition, ARM Holdings plc (ARMH) is up 6 percent on speculation it could be in the radar of Oracle.
Shares of Oracle are up 37 cents to $27.49 in early market movement on Friday.
Ellison's comments Thursday at the Oracle OpenWorld conference indicated that the company will buy a semiconductor company with technology for servers.
Possible targets include Advanced Micro Devices Inc. (NYSE: AMD, the chip business of International Business Machines Corp. (NYSE: IBM) and NVIDIA Corp. (NASDAQ: NVDA).
"You're going to see us buying chip companies," Ellison said. "We want to play in every important industry."
Oracle jumped deeper into the hardware business with its acquisition in January of server manufacturer, Sun Microsystems Inc.
Oracle is the world's second-largest software company, having $23.6 billion in cash and short-term investments at the end of its most recent quarter. Adding to the speculation that the company will go deeper into hardware, it hired former Hewlett-Packard Co. (NYSE: HPQ) CEO Mark Hurd.
The company is looking to double the size of its hardware business, which generated $1.7 billion last quarter.
"I would be stunned if 10 years from now, most data centers didn't rely on these engineered systems," Ellison said. "We're betting that this is the future of computing."
The comments are driving shares of AMD (NYSE: AMD) up 5.5 percent and NVIDIA up 2 percent. In addition, ARM Holdings plc (ARMH) is up 6 percent on speculation it could be in the radar of Oracle.
Shares of Oracle are up 37 cents to $27.49 in early market movement on Friday.
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