Oracle 2007 Annual Report Download - page 18

Table of Contents
Mr. Williams, 63, has been Executive Vice President, Japan Sales and Consulting since June 2008 and was Executive
Vice President, Asia Pacific Sales and Consulting from October 2000 to May 2008. He served as Senior Vice
President, Asia Pacific from July 1993 to October 2000 and as Vice President, Asia Pacific from April 1991 to July
1993. He joined Oracle United Kingdom in October 1988 and served as Regional Director, Strategic Accounts from
October 1988 to April 1991.
Ms. Daley, 49, has been Senior Vice President, General Counsel and Secretary since October 2007. She served as
Vice President, Legal, Associate General Counsel and Assistant Secretary from June 2004 to October 2007, as
Associate General Counsel and Assistant Secretary from October 2001 to June 2004, and as Associate General
Counsel from February 2001 to October 2001. She joined Oracle’s Legal Department in 1992.
Mr. West, 46, has been Senior Vice President, Corporate Controller and Chief Accounting Officer since February
2008 and was Vice President, Corporate Controller and Chief Accounting Officer from April 2007 to February 2008.
Prior to joining us, he served as Intuit Inc.’s Director of Accounting from August 2005 to March 2007, as The Gap,
Inc.’s Assistant Controller from April 2005 to August 2005, and as Vice President, Finance, at Cadence Design
Systems, Inc.’s product business from June 2001 to April 2005. He also spent 14 years with Arthur Andersen LLP,
most recently as a partner.
Item 1A. Risk Factors
We operate in a rapidly changing economic and technological environment that presents numerous risks, many of
which are driven by factors that we cannot control or predict. The following discussion, as well as our “Critical
Accounting Policies and Estimates” discussion in Item 7, highlights some of these risks.
Economic, political and market conditions can adversely affect our revenue growth and profitability. Our business
is influenced by a range of factors that are beyond our control and that we have no comparative advantage in
forecasting. These include:
• general economic and business conditions;
• the overall demand for enterprise software and services;
• governmental budgetary constraints or shifts in government spending priorities; and
• general political developments.
A general weakening of, or declining corporate confidence in, the global economy, or a curtailment in government or
corporate spending could delay or decrease customer purchases. In addition, the war on terrorism, the war in Iraq and
the potential for other hostilities in various parts of the world, potential public health crises and natural disasters
continue to contribute to a climate of economic and political uncertainty that could adversely affect our revenue
growth and results of operations. These factors generally have the strongest effect on our sales of software licenses
and related services and, to a lesser extent, also affect our renewal rates for software license updates and product
support.
We may fail to achieve our financial forecasts due to inaccurate sales forecasts or other factors. Our revenues,
and particularly our new software license revenues, are difficult to forecast, and, as a result, our quarterly operating
results can fluctuate substantially. We use a “pipeline” system, a common industry practice, to forecast sales and
trends in our business. Our sales personnel monitor the status of all proposals and estimate when a customer will
make a purchase decision and the dollar amount of the sale. These estimates are aggregated periodically to generate a
sales pipeline. Our pipeline estimates can prove to be unreliable both in a particular quarter and over a longer period
of time, in part because the “conversion rate” of the pipeline into contracts can be very difficult to estimate. A
contraction in the conversion rate, or in the pipeline itself, could cause us to plan or budget incorrectly and adversely
affect our business or results of operations. In particular, a slowdown in IT spending or economic conditions
generally can reduce the conversion rate in particular periods as purchasing decisions are delayed, reduced in amount
or cancelled. The conversion rate can also be affected by the tendency of some of our customers to wait until the end
of a fiscal period in the hope of obtaining more favorable terms, which can also impede our ability to negotiate and
execute these contracts in a timely manner. In addition, for newly acquired companies, we have limited ability to
predict how their pipelines will convert into sales or revenues for one or two quarters following the acquisition, and
their conversion rate post-acquisition may be quite different from their historical conversion rate.
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Source: ORACLE CORP, 10-K, July 02, 2008 Powered by Morningstar® Document Research℠