Oracle 2007 Annual Report Download - page 48

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Table of Contents
Fiscal 2008 Compared to Fiscal 2007: Consulting revenue growth was positively affected by foreign
currency rate fluctuations of 6 percentage points in fiscal 2008. Excluding the effect of currency rate
fluctuations, consulting revenues increased during fiscal 2008 primarily due to an increase in application
product implementations associated with the sales of our application software products and incremental
revenues from our recent acquisitions, primarily Hyperion and BEA. BEA added $16 million to our
consulting revenue growth in fiscal 2008. Excluding the effect of currency rate fluctuations, the Americas
contributed 36%, EMEA contributed 35% and Asia Pacific contributed 29% to the increase in consulting
revenues.
Consulting expenses were adversely impacted by 6 percentage points of unfavorable currency variations
during fiscal 2008. Excluding the effect of currency rate fluctuations, consulting expenses increased during
fiscal 2008 as a result of higher personnel related expenses attributable to higher headcount levels and third
party contractor expenses that supported our increase in revenues. BEA added $16 million to our consulting
expense growth in fiscal 2008. Total consulting margin as a percentage of revenues remained constant during
fiscal 2008 as margin improvements in the EMEA and Asia Pacific regions were offset by expense growth in
the Americas region and for i-flex and an increase in our amortization of intangible asset expenses.
Fiscal 2007 Compared to Fiscal 2006: Excluding the effect of currency rate fluctuations, consulting
revenues increased during fiscal 2007 primarily due to an increase in our application product implementations
associated with the increase in sales of our application software products and incremental revenues from our
acquisitions, including $359 million of incremental revenues from i-flex, whom we acquired at the beginning
of fiscal 2007, and $16 million of incremental revenues from Hyperion. Excluding the effect of currency rate
fluctuations, the Americas contributed 55%, EMEA contributed 29% and Asia Pacific contributed 16% to the
increase in consulting revenues.
Excluding the effect of currency rate fluctuations, consulting expenses increased in fiscal 2007 as a result of
higher personnel related expenses attributable to higher headcount levels and third-party contractor expenses.
Consulting expenses included $281 million of incremental expenses from i-flex and $17 million from
Hyperion. Total consulting margin as a percentage of revenues increased primarily due to higher margins
contributed by i-flex.
On Demand: On Demand includes our Oracle On Demand, CRM On Demand and Advanced Customer
Services offerings. Oracle On Demand provides multi-featured software and hardware management, and
maintenance services for our database and middleware as well as our applications software delivered either at
our data center facilities, at select partner data centers, or at customer facilities. CRM On Demand is a service
offering that provides our customers with our CRM software functionality delivered via a hosted solution that
we manage. Advanced Customer Services consists of configuration and performance analysis, personalized
support and on-site technical services. The cost of providing On Demand services consists primarily of
personnel related expenditures, technology infrastructure expenditures and facilities costs.
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Source: ORACLE CORP, 10-K, July 02, 2008 Powered by Morningstar® Document Research℠