Oracle 2006 Annual Report Download - page 44

Table of Contents
Excluding the effect of currency rate fluctuations, database and middleware revenues grew 12% as a result of
a gain in market share, increased demand for our database and middleware products as well as incremental
revenues from acquired companies. Siebel products contributed incremental revenues of $48 million, Stellent
products $26 million, Hyperion products $16 million and other recently acquired products $19 million to the
total database and middleware revenue growth in fiscal 2007.
On a constant currency basis, applications revenues increased 29% as a result of a gain in market share
resulting from a strengthening of our competitive position in the applications market due to improved product
features and functionality and incremental revenues from acquired companies. Siebel products contributed
incremental revenues of $130 million, i-flex products $50 million, Hyperion products $27 million, Portal
products $22 million, Demantra products $21 million and other recently acquired products $22 million to
total applications revenue growth.
New software license revenues earned from transactions over $0.5 million grew by 24% in fiscal 2007 and
increased from 45% of new software license revenues in fiscal 2006 to 46% in fiscal 2007.
Excluding the effect of currency rate fluctuations, sales and marketing expenses increased in fiscal 2007
primarily due to higher personnel related expenses associated with increased headcount, as well as higher
commissions expenses associated with both increased revenues and headcount levels. Total new software
license margin as a percentage of revenues declined as expenses, including amortization costs of intangible
assets, grew at a faster rate than revenues.
Fiscal 2006 Compared to Fiscal 2005: Excluding the effect of currency rate fluctuations, new software
license revenues increased due to strong sales execution in all product lines. Applications revenues
contributed 60% to the increase in new software license revenues, while database and middleware revenues
contributed 40%. Additionally, new software license revenues increased in all geographic regions. Excluding
the effect of currency rate fluctuations, the Americas contributed 57%, EMEA contributed 23% and Asia
Pacific contributed 20% to the increase in new software license revenues. New software license revenues in
the Americas, specifically in the United States, increased at a faster rate than in other regions primarily due to
the relative geographical mix of revenues and location of sales personnel from our acquired companies.
Excluding the effect of currency rate fluctuations, database and middleware revenues grew 11% driven by
increased demand for database option products, and gain in market share in the application server market as a
result of better sales execution and more competitive features and functionality. Siebel products contributed
$34 million to the growth in database and middleware revenues.
Excluding the effect of currency rate fluctuations, applications revenues increased 67% as a result of
increased demand for our applications products, including products from acquired companies, better sales
execution as a result of segmenting our sales force by product and a strengthening of our competitive position
in the applications market, particularly in the United States and EMEA. PeopleSoft products contributed
$220 million to the growth in applications revenue in fiscal 2006, Siebel products contributed $103 million
and Retek products contributed $41 million.
New software license revenues earned from transactions over $0.5 million increased from 40% of new
software license revenues in fiscal 2005 to 45% in fiscal 2006.
Excluding the effect of currency rate fluctuations, sales and marketing expenses increased due to higher
commission expenses resulting from the growth in new software license revenues, higher personnel related
expenditures primarily associated with our expanded sales force from acquired companies and higher
advertising expenses. The total new software license margin as a percentage of revenues decreased primarily
due to incremental amortization of intangible assets and higher compensation expenses.
Software License Updates and Product Support: Software license updates grant customers rights to
unspecified software product upgrades and maintenance releases issued during the support period. Product
support includes internet access to technical content as well as internet and telephone access to technical
support personnel in our global support centers. Expenses associated with our software license updates and
product support line of business
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Source: ORACLE CORP, 10-K, June 29, 2007 Powered by Morningstar® Document Research℠