8-K

UNITED STATES
SECURITIES AND EXCHANGE COMMISSION

WASHINGTON, DC 20549

FORM 8-K

CURRENT REPORT
PURSUANT TO SECTION 13 OR 15(d) OF THE
SECURITIES EXCHANGE ACT OF 1934

Date of report (Date of earliest event reported): September 18, 2008

Oracle Corporation

(Exact name of Registrant as Specified in its Charter)

Delaware
(State or Other Jurisdiction of Incorporation) 000-51788
(Commission
File Number) 54-2185193
(IRS Employer
Identification No.)

500 Oracle Parkway, Redwood City, California 94065
(Address of Principal Executive Offices) (Zip Code)

(650) 506-7000
(Registrant’s telephone number, including area code)

N/A
(Former Name or Former Address, if Changed Since Last Report)

Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions:

o     Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)

o     Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)

o     Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))

o     Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))

TABLE OF CONTENTS

EXHIBIT 99.1

Section 2—Financial Information

     Item 2.02 Results of Operations and Financial Condition

On September 18, 2008, Oracle Corporation issued a press release announcing financial results for its fiscal first quarter ended August 31, 2008. A copy of this press release is furnished as Exhibit 99.1 to this report.

Section 9—Financial Statements and Exhibits

     Item 9.01 Financial Statements and Exhibits

(d) Exhibits

Exhibit
Number	Description of Exhibit
99.1	Press Release dated September 18, 2008

SIGNATURE

Pursuant to the requirements of the Securities Exchange Act of 1934, as amended, the Registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.

	ORACLE CORPORATION
Dated: September 18, 2008	By:	/s/ William Corey West
		William Corey West
		Senior Vice President, Corporate Controller and Chief Accounting Officer

EXHIBIT LIST

Exhibit No.	Description of Exhibit
99.1	Press Release dated September 18, 2008

EX-99.1

Exhibit 99.1

For Immediate Release

Contacts:	Roy Lobo	Deborah Hellinger
	Oracle Investor Relations	Oracle Corporate Communications
	+1.650.506.4073	+1.650.506.5158
	investor_us@oracle.com	deborah.hellinger@oracle.com

ORACLE REPORTS Q1 GAAP EPS UP 28% TO 21 CENTS, NON-GAAP EPS UP 32% TO 29 CENTS

New Software License Revenues Up 14%, Total GAAP Software Revenues Up 20%

     REDWOOD SHORES, Calif., Sept. 18, 2008 — Oracle Corporation (NASDAQ: ORCL) today announced fiscal 2009 Q1 GAAP earnings per share were up 28% to $0.21 compared to the same quarter last year. First quarter total GAAP revenues were up 18% to $5.3 billion, while quarterly GAAP net income was up 28% to $1.1 billion. Total GAAP software revenues were up 20% to $4.2 billion with new software license revenues up 14% to $1.2 billion. GAAP Software license updates and product support revenues were up 23% to $2.9 billion. GAAP Services revenues were up 9% to $1.2 billion. GAAP operating margins were up 170 basis points to 29%.

     First quarter non-GAAP earnings per share were up 32% to $0.29, and non-GAAP net income was up 32% to $1.5 billion, compared to the same quarter last year. Non-GAAP total revenues were up 18% to $5.4 billion. Non-GAAP total software revenues were up 21% to $4.3 billion and non-GAAP software license updates and product support revenues were up 24% to $3.0 billion.

     “Our non-GAAP EPS grew 32% in Q1, and this comes after the 27% growth in Q1 of last year,” said Oracle President and CFO, Safra Catz. “We also delivered a Q1 non-GAAP operating margin of 40%, our highest ever in Q1, up 350 basis points from the quarter a year ago. We continue to deliver consistent earnings growth well ahead of plan.”

     “Oracle has once again increased its database market share according to the latest Gartner research report,” said Oracle CEO, Larry Ellison. “Oracle’s 49% market share in the survey year 2007 was greater than the market share of the next 4 vendors combined: IBM, Microsoft, Teradata, and Sybase.”

     “More-and-more Oracle database customers are buying our integrated suite of standards based Fusion middleware to modernize their computing environments,” said Charles Phillips, Oracle President. “The Oracle product line of database, middleware and applications is by far the most extensive in the enterprise software industry. That enables us to offer a broader range of solutions than any other software vendor.”

Q1 Earnings Announcement

Oracle will hold a conference call and web broadcast today to discuss these results at 2:00 p.m. (PDT) / 5:00 p.m. (EDT). To access the live web broadcast of this event, please visit the Oracle Investor Relations website at http://www.oracle.com/investor. Please hold down your control key while pressing refresh to ensure that the web link is visible.

About Oracle

Oracle is the world’s largest enterprise software company. For more information about Oracle, including supplemental financial information, please visit http://www.oracle.com/investor or call Investor Relations at (650) 506-4073.

# # #

Trademarks

Oracle is a registered trademark of Oracle Corporation and/or its affiliates. Other names may be trademarks of their respective owners.

“Safe Harbor” Statement:  Statements in this press release relating to Oracle’s future plans and prospects are “forward-looking statements” and are subject to material risks and uncertainties. Many factors could affect our current expectations and our actual results, and could cause actual results to differ materially.  We presently consider the following to be among the important factors that could cause actual results to differ materially from expectations: (1) Economic, political and market conditions could adversely affect our revenue growth and profitability through reductions in IT budgets and expenditures.  (2) We may fail to achieve our financial forecasts due to such factors as delays or size reductions in transactions, fewer large transactions in a particular quarter, unanticipated fluctuations in currency exchange rates, delays in delivery of new products or releases, or a decline in our renewal rates for software license updates and product support.  (3) We cannot assure market acceptance of new products or new versions of existing or acquired products.  (4) We have an active acquisition program and our acquisitions may not be successful, may involve unanticipated costs or other integration issues, or may disrupt our existing operations.  (5) Periodic changes to our pricing model and sales organization could temporarily disrupt operations and cause a decline or delay in sales.  (6) Intense competitive forces demand rapid technological advances and frequent new product introductions, and could require us to reduce prices.   A detailed discussion of these factors and other risks that affect our business is contained in our SEC filings, including our most recent reports on Form 10-K and Form 10-Q, particularly under the heading “Risk Factors.” Copies of these filings are available online from the SEC or by contacting Oracle Corporation’s Investor Relations Department at (650) 506-4073 or by clicking on SEC Filings on Oracle’s Investor Relations website at http://www.oracle.com/investor.  All information set forth in this release is current as of September 18, 2008. Oracle undertakes no duty to update any statement in light of new information or future events.

ORACLE CORPORATION

Q1 FISCAL 2009 FINANCIAL RESULTS
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
($ in millions, except per share data)

																% Increase
	Three Months Ended August 31,															(Decrease)
				% of						% of			% Increase			in Constant
	2008			Revenues			2007			Revenues			in US $			Currency (1)
REVENUES
New software licenses	$	1,237			23	%	$	1,087			24	%		14	%		10	%
Software license updates and product support		2,935			55	%		2,383			53	%		23	%		18	%
Software Revenues		4,172			78	%		3,470			77	%		20	%		16	%
Services		1,159			22	%		1,059			23	%		9	%		6	%
Total Revenues		5,331			100	%		4,529			100	%		18	%		14	%
OPERATING EXPENSES
Sales and marketing		1,112			21	%		974			22	%		14	%		10	%
Software license updates and product support		282			5	%		228			5	%		24	%		19	%
Cost of services		1,026			19	%		931			21	%		10	%		7	%
Research and development		708			13	%		652			14	%		9	%		8	%
General and administrative		206			4	%		195			4	%		5	%		3	%
Amortization of intangible assets		413			8	%		285			6	%		45	%		45	%
Acquisition related and other		49			1	%		47			1	%		6	%		8	%
Restructuring		14			0	%		—			0	%		*			*
Total Operating Expenses		3,810			71	%		3,312			73	%		15	%		12	%
OPERATING INCOME		1,521			29	%		1,217			27	%		25	%		18	%
Interest expense		(159	)		(3	%)		(94	)		(2	%)		71	%		71	%
Non-operating income, net		82			1	%		77			2	%		7	%		4	%
INCOME BEFORE PROVISION FOR INCOME TAXES		1,444			27	%		1,200			27	%		20	%		13	%
Provision for income taxes		367			7	%		360			8	%		2	%		(1	%)
NET INCOME	$	1,077			20	%	$	840			19	%		28	%		19	%
EARNINGS PER SHARE:
Basic	$	0.21					$	0.16
Diluted	$	0.21					$	0.16
WEIGHTED AVERAGE COMMON SHARES OUTSTANDING:
Basic		5,152						5,110
Diluted		5,235						5,217

(1)

We compare the percent change in the results from one period to another period using constant currency disclosure. We present constant currency information to provide a framework for assessing how our underlying businesses performed excluding the effect of foreign currency rate fluctuations. To present this information, current and comparative prior period results for entities reporting in currencies other than United States dollars are converted into United States dollars at the exchange rate in effect on May 31, 2008, which was the last day of our prior fiscal year, rather than the actual exchange rates in effect during the respective periods. The United States dollar weakened relative to major international currencies in the three months ended August 31, 2008 compared with the corresponding prior year period, contributing 4 percentage points of revenue, 3 percentage points of operating expense and 7 percentage points of operating income growth.

*

Not meaningful

ORACLE CORPORATION

Q1 FISCAL 2009 FINANCIAL RESULTS
RECONCILIATION OF SELECTED GAAP MEASURES TO NON-GAAP MEASURES (1)

($ in millions, except per share data)

	Three Months Ended August 31,																		% Increase in US $
	2008						2008			2007						2007
	GAAP			Adj.			Non-GAAP			GAAP			Adj.			Non-GAAP			GAAP			Non-GAAP
TOTAL REVENUES (2)	$	5,331		$	91		$	5,422		$	4,529		$	64		$	4,593			18	%		18	%
TOTAL SOFTWARE REVENUES (2)	$	4,172		$	91		$	4,263		$	3,470		$	64		$	3,534			20	%		21	%
New software licenses		1,237			—			1,237			1,087			—			1,087			14	%		14	%
Software license updates and product support (2)		2,935			91			3,026			2,383			64			2,447			23	%		24	%
TOTAL OPERATING EXPENSES	$	3,810		$	(562	)	$	3,248		$	3,312		$	(401	)	$	2,911			15	%		12	%
Stock-based compensation (3)		86			(86	)		—			69			(69	)		—			25	%		*
Amortization of intangible assets (4)		413			(413	)		—			285			(285	)		—			45	%		*
Acquisition related and other		49			(49	)		—			47			(47	)		—			6	%		*
Restructuring		14			(14	)		—			—			—			—			*			*
OPERATING INCOME	$	1,521		$	653		$	2,174		$	1,217		$	465		$	1,682			25	%		29	%
OPERATING MARGIN %		29	%					40	%		27	%					37	%		6	%		10	%
INCOME TAX EFFECTS (5)	$	367		$	186		$	553		$	360		$	140		$	500			2	%		11	%
NET INCOME	$	1,077		$	467		$	1,544		$	840		$	325		$	1,165			28	%		32	%
DILUTED EARNINGS PER SHARE	$	0.21					$	0.29		$	0.16					$	0.22			28	%		32	%
DILUTED WEIGHTED AVERAGE COMMON SHARES OUTSTANDING		5,235			—			5,235			5,217			3			5,220			0	%		0	%

(1)	This presentation includes non-GAAP measures. Our non-GAAP measures are not meant to be considered in isolation or as a substitute for comparable GAAP measures, and should be read only in conjunction with our consolidated financial statements prepared in accordance with GAAP. For a detailed explanation of the adjustments made to comparable GAAP measures, the reasons why management uses these measures, the usefulness of these measures and the material limitations on the usefulness of these measures, please see Appendix A.
(2)	As of August 31, 2008, approximately $221 million in estimated revenues related to assumed support contracts will not be recognized in fiscal 2009 due to business combination accounting rules.
(3)	Stock-based compensation is included in the following GAAP operating expense categories:

	Three Months Ended							Three Months Ended
	August 31, 2008							August 31, 2007
	GAAP		Adj.			Non-GAAP		GAAP		Adj.			Non-GAAP
Sales and marketing	$	19	$	(19	)	$	—	$	13	$	(13	)	$	—
Software license updates and product support		3		(3	)		—		4		(4	)		—
Cost of services		3		(3	)		—		4		(4	)		—
Research and development		37		(37	)		—		28		(28	)		—
General and administrative		24		(24	)		—		20		(20	)		—
Subtotal		86		(86	)		—		69		(69	)		—
Acquisition related and other		5		(5	)		—		32		(32	)		—
Total stock-based compensation	$	91	$	(91	)	$	—	$	101	$	(101	)	$	—

(4) Estimated future annual amortization expense related to intangible assets as of August 31, 2008 is as follows:

Remainder of Fiscal 2009	$	1,271
Fiscal 2010		1,578
Fiscal 2011		1,288
Fiscal 2012		1,143
Fiscal 2013		1,013
Fiscal 2014		827
Thereafter		1,033
Total	$	8,153

(5)

Income tax effects were calculated reflecting an effective GAAP tax rate of 25.4% and 30.0% in the first quarter of fiscal 2009 and 2008, respectively, and an effective non-GAAP tax rate of 26.4% and 30.0% in the first quarter of fiscal 2009 and 2008, respectively. Our non-GAAP tax rate in the first quarter of fiscal 2009 excludes the effect of an adjustment to our non-current deferred tax liability associated with acquired intangible assets.

*

Not meaningful

ORACLE CORPORATION

Q1 FISCAL 2009 FINANCIAL RESULTS
CONDENSED CONSOLIDATED BALANCE SHEETS

($ in millions)

	August 31,		May 31,
	2008		2008
ASSETS
Current Assets:
Cash and cash equivalents	$	8,553	$	8,262
Marketable securities		4,468		2,781
Trade receivables, net		3,260		5,127
Deferred tax assets		905		853
Prepaid expenses and other current assets		665		1,080
Total Current Assets		17,851		18,103
Non-Current Assets:
Property, net		1,886		1,688
Intangible assets, net		8,153		8,395
Goodwill		18,260		17,991
Other assets		1,103		1,091
Total Non-Current Assets		29,402		29,165
TOTAL ASSETS	$	47,253	$	47,268
LIABILITIES AND STOCKHOLDERS’ EQUITY
Current Liabilities:
Notes payable, current and other current borrowings	$	1,001	$	1,001
Accounts payable		402		383
Accrued compensation and related benefits		1,138		1,770
Deferred revenues		5,017		4,492
Other current liabilities		1,689		2,383
Total Current Liabilities		9,247		10,029
Non-Current Liabilities:
Notes payable and other non-current borrowings		10,236		10,235
Income taxes payable		1,638		1,566
Deferred tax liabilities		1,214		1,218
Other non-current liabilities		1,102		1,195
Total Non-Current Liabilities		14,190		14,214
Stockholders’ Equity		23,816		23,025
TOTAL LIABILITIES AND STOCKHOLDERS’ EQUITY	$	47,253	$	47,268

ORACLE CORPORATION

Q1 FISCAL 2009 FINANCIAL RESULTS
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS

($ in millions)

	Three Months Ended August 31,
	2008			2007
Cash Flows From Operating Activities:
Net income	$	1,077		$	840
Adjustments to reconcile net income to net cash provided by operating activities:
Depreciation		64			67
Amortization of intangible assets		413			285
Deferred income taxes		(53	)		24
Minority interests in income		16			12
Stock-based compensation		91			101
Tax benefit on the exercise of stock options		101			129
Excess tax benefits on the exercise of stock options		(65	)		(82	)
In-process research and development		4			7
Other gains, net		(1	)		—
Changes in operating assets and liabilities, net of effects from acquisitions:
Decrease in trade receivables, net		1,812			1,381
Decrease in prepaid expenses and other assets		397			161
Decrease in accounts payable and other liabilities		(906	)		(679	)
Decrease in income taxes payable		(361	)		(301	)
Increase in deferred revenues		651			756
Net cash provided by operating activities		3,240			2,701
Cash Flows From Investing Activities:
Purchases of marketable securities and other investments		(3,188	)		(896	)
Proceeds from maturities and sales of marketable securities and other investments		1,420			561
Acquisitions, net of cash acquired		(395	)		(546	)
Capital expenditures		(323	)		(87	)
Net cash used for investing activities		(2,486	)		(968	)
Cash Flows From Financing Activities:
Payments for repurchases of common stock		(500	)		(530	)
Proceeds from issuances of common stock		280			317
Repayments of borrowings		(4	)		(1,361	)
Excess tax benefits on the exercise of stock options		65			82
Distributions to minority interests		(30	)		(28	)
Net cash used for financing activities		(189	)		(1,520	)
Effect of exchange rate changes on cash and cash equivalents		(274	)		24
Net increase in cash and cash equivalents		291			237
Cash and cash equivalents at beginning of period		8,262			6,218
Cash and cash equivalents at end of period	$	8,553		$	6,455

ORACLE CORPORATION

Q1 FISCAL 2009 FINANCIAL RESULTS
FREE CASH FLOW — TRAILING 4-QUARTERS (1)

($ in millions)

	Fiscal 2008												Fiscal 2009
	Q1			Q2			Q3			Q4			Q1			Q2	Q3	Q4
GAAP Operating Cash Flow	$	6,598		$	6,957		$	7,322		$	7,402		$	7,941
Capital Expenditures (2)		(357	)		(369	)		(331	)		(243	)		(479	)
Free Cash Flow	$	6,241		$	6,588		$	6,991		$	7,159		$	7,462
% Growth over prior year		40	%		50	%		48	%		38	%		20	%
GAAP Net Income	$	4,444		$	4,781		$	5,088		$	5,521		$	5,758
Free Cash Flow as a % of Net Income		140	%		138	%		137	%		130	%		130	%

(1)

To supplement our statements of cash flows presented on a GAAP basis, we use non-GAAP measures of cash flows on a trailing 4-quarter basis to analyze cash flow generated from operations. We believe free cash flow is also useful as one of the bases for comparing our performance with our competitors. The presentation of non-GAAP free cash flow is not meant to be considered in isolation or as an alternative to net income as an indicator of our performance, or as an alternative to cash flows from operating activities as a measure of liquidity.

(2)

Represents capital expenditures as reported in cash flows from investing activities on our cash flow statements presented in accordance with GAAP.

ORACLE CORPORATION

Q1 FISCAL 2009 FINANCIAL RESULTS
SUPPLEMENTAL ANALYSIS OF GAAP REVENUES AND HEADCOUNT (1)

($ in millions)

	Fiscal 2008															Fiscal 2009
	Q1			Q2			Q3			Q4			TOTAL			Q1			Q2	Q3	Q4	TOTAL
REVENUES
New software licenses	$	1,087		$	1,668		$	1,616		$	3,144		$	7,515		$	1,237					$	1,237
Software license updates and product support		2,383			2,491			2,624			2,830			10,328			2,935						2,935
Software Revenues		3,470			4,159			4,240			5,974			17,843			4,172						4,172
Consulting		801			877			843			957			3,477			865						865
On Demand		158			167			174			194			694			195						195
Education		100			110			92			114			416			99						99
Services Revenues		1,059			1,154			1,109			1,265			4,587			1,159						1,159
Total Revenues	$	4,529		$	5,313		$	5,349		$	7,239		$	22,430		$	5,331					$	5,331
AS REPORTED REVENUE GROWTH RATES
New software licenses		35	%		38	%		16	%		27	%		28	%		14	%					14	%
Software license updates and product support		23	%		24	%		25	%		25	%		24	%		23	%					23	%
Software Revenues		26	%		29	%		21	%		26	%		26	%		20	%					20	%
Consulting		25	%		23	%		21	%		17	%		21	%		8	%					8	%
On Demand		27	%		20	%		23	%		29	%		25	%		23	%					23	%
Education		24	%		17	%		16	%		9	%		16	%		(2	%)					(2	%)
Services Revenues		25	%		22	%		21	%		18	%		21	%		9	%					9	%
Total Revenues		26	%		28	%		21	%		24	%		25	%		18	%					18	%
CONSTANT CURRENCY GROWTH RATES
New software licenses		32	%		31	%		9	%		20	%		21	%		10	%					10	%
Software license updates and product support		19	%		18	%		18	%		18	%		18	%		18	%					18	%
Software Revenues		23	%		23	%		15	%		19	%		19	%		16	%					16	%
Consulting		20	%		15	%		14	%		11	%		15	%		5	%					5	%
On Demand		23	%		15	%		17	%		23	%		19	%		19	%					19	%
Education		20	%		10	%		9	%		2	%		10	%		(6	%)					(6	%)
Services Revenues		21	%		15	%		14	%		12	%		15	%		6	%					6	%
Total Revenues		22	%		21	%		15	%		18	%		19	%		14	%					14	%
GEOGRAPHIC REVENUES
REVENUES
Americas	$	2,375		$	2,674		$	2,707		$	3,574		$	11,330		$	2,687					$	2,687
Europe, Middle East & Africa		1,530			1,865			1,871			2,679			7,945			1,830						1,830
Asia Pacific		624			774			771			986			3,155			814						814
Total Revenues	$	4,529		$	5,313		$	5,349		$	7,239		$	22,430		$	5,331					$	5,331
HEADCOUNT (2)
GEOGRAPHIC AREA
Americas		30,455			30,654			30,624			32,608						32,993						32,993
Europe, Middle East & Africa		15,985			16,140			16,383			17,110						17,096						17,096
Asia Pacific		31,212			32,855			33,212			34,515						35,099						35,099
Total Company		77,652			79,649			80,219			84,233						85,188						85,188

(1)	The sum of the quarterly financial information may vary from year-to-date financial information due to rounding.
(2)	Headcount has increased primarily due to our acquisitions.

ORACLE CORPORATION

Q1 FISCAL 2009 FINANCIAL RESULTS
SUPPLEMENTAL TOTAL SOFTWARE PRODUCT REVENUE ANALYSIS (1)

($ in millions)

	Fiscal 2008															Fiscal 2009
	Q1			Q2			Q3			Q4			TOTAL			Q1			Q2	Q3	Q4	TOTAL
APPLICATIONS REVENUES
New software licenses	$	376		$	553		$	451		$	989		$	2,369		$	331					$	331
Software license updates and product support		886			929			974			1,044			3,833			1,043						1,043
Software Revenues	$	1,262		$	1,482		$	1,425		$	2,033		$	6,202		$	1,374					$	1,374
AS REPORTED GROWTH RATES
New software licenses		65	%		63	%		7	%		36	%		38	%		(12	%)					(12	%)
Software license updates and product support		26	%		28	%		27	%		25	%		26	%		18	%					18	%
Software Revenues		36	%		39	%		20	%		30	%		31	%		9	%					9	%
CONSTANT CURRENCY GROWTH RATES
New software licenses		61	%		56	%		2	%		31	%		33	%		(14	%)					(14	%)
Software license updates and product support		22	%		21	%		20	%		19	%		20	%		13	%					13	%
Software Revenues		32	%		32	%		14	%		24	%		25	%		5	%					5	%
DATABASE & MIDDLEWARE REVENUES
New software licenses	$	711		$	1,115		$	1,165		$	2,155		$	5,146		$	906					$	906
Software license updates and product support		1,497			1,562			1,650			1,786			6,495			1,892						1,892
Software Revenues	$	2,208		$	2,677		$	2,815		$	3,941		$	11,641		$	2,798					$	2,798
AS REPORTED GROWTH RATES
New software licenses		23	%		29	%		20	%		23	%		24	%		27	%					27	%
Software license updates and product support		21	%		22	%		23	%		24	%		23	%		26	%					26	%
Software Revenues		22	%		25	%		22	%		23	%		23	%		27	%					27	%
CONSTANT CURRENCY GROWTH RATES
New software licenses		20	%		22	%		13	%		15	%		17	%		23	%					23	%
Software license updates and product support		17	%		16	%		17	%		17	%		17	%		22	%					22	%
Software Revenues		18	%		18	%		15	%		16	%		17	%		22	%					22	%

(1) The sum of the quarterly financial information may vary from year-to-date financial information due to rounding.

ORACLE CORPORATION

Q1 FISCAL 2009 FINANCIAL RESULTS
SUPPLEMENTAL GEOGRAPHIC NEW SOFTWARE LICENSE REVENUE ANALYSIS (1) (2)

($ in millions)

	Fiscal 2008															Fiscal 2009
	Q1			Q2			Q3			Q4			TOTAL			Q1			Q2	Q3	Q4	TOTAL
AMERICAS
Database & Middleware	$	286		$	438		$	476		$	919		$	2,119		$	342					$	342
Applications		199			306			252			552			1,310			182						182
New Software License Revenues	$	485		$	744		$	728		$	1,471		$	3,429		$	524					$	524
AS REPORTED GROWTH RATES
Database & Middleware		23	%		32	%		24	%		16	%		22	%		20	%					20	%
Applications		58	%		57	%		1	%		33	%		33	%		(9	%)					(9	%)
New Software License Revenues		35	%		41	%		15	%		22	%		26	%		8	%					8	%
CONSTANT CURRENCY GROWTH RATES
Database & Middleware		22	%		29	%		21	%		13	%		19	%		18	%					18	%
Applications		57	%		54	%		(1	%)		32	%		31	%		(10	%)					(10	%)
New Software License Revenues		34	%		38	%		12	%		20	%		23	%		7	%					7	%
EUROPE / MIDDLE EAST / AFRICA
Database & Middleware	$	253		$	420		$	446		$	881		$	2,000		$	321					$	321
Applications		123			174			141			317			755			94						94
New Software License Revenues	$	376		$	594		$	587		$	1,198		$	2,755		$	415					$	415
AS REPORTED GROWTH RATES
Database & Middleware		38	%		23	%		23	%		42	%		33	%		27	%					27	%
Applications		77	%		72	%		14	%		41	%		46	%		(23	%)					(23	%)
New Software License Revenues		49	%		34	%		21	%		42	%		36	%		10	%					10	%
CONSTANT CURRENCY GROWTH RATES
Database & Middleware		30	%		12	%		11	%		27	%		20	%		19	%					19	%
Applications		69	%		58	%		6	%		31	%		35	%		(26	%)					(26	%)
New Software License Revenues		41	%		23	%		10	%		28	%		24	%		5	%					5	%
ASIA PACIFIC
Database & Middleware	$	155		$	244		$	231		$	341		$	971		$	225					$	225
Applications		54			73			58			120			304			55						55
New Software License Revenues	$	209		$	317		$	289		$	461		$	1,275		$	280					$	280
AS REPORTED GROWTH RATES
Database & Middleware		4	%		32	%		8	%		6	%		12	%		46	%					46	%
Applications		67	%		66	%		18	%		37	%		43	%		1	%					1	%
New Software License Revenues		15	%		39	%		10	%		13	%		18	%		34	%					34	%
CONSTANT CURRENCY GROWTH RATES
Database & Middleware		1	%		26	%		0	%		(1	%)		5	%		39	%					39	%
Applications		60	%		57	%		5	%		27	%		33	%		(1	%)					(1	%)
New Software License Revenues		12	%		32	%		1	%		5	%		11	%		29	%					29	%
TOTAL COMPANY
Database & Middleware	$	694		$	1,102		$	1,153		$	2,141		$	5,090		$	888					$	888
Applications		376			553			451			989			2,369			331						331
New Software License Revenues	$	1,070		$	1,655		$	1,604		$	3,130		$	7,459		$	1,219					$	1,219
AS REPORTED GROWTH RATES
Database & Middleware		23	%		28	%		20	%		23	%		24	%		28	%					28	%
Applications		65	%		63	%		7	%		36	%		38	%		(12	%)					(12	%)
New Software License Revenues		35	%		38	%		16	%		27	%		28	%		14	%					14	%
CONSTANT CURRENCY GROWTH RATES
Database & Middleware		19	%		21	%		12	%		16	%		17	%		23	%					23	%
Applications		61	%		56	%		2	%		31	%		33	%		(14	%)					(14	%)
New Software License Revenues		31	%		31	%		9	%		20	%		21	%		10	%					10	%

(1)	The sum of the quarterly financial information may vary from year-to-date financial information due to rounding.
(2)	New Software License Revenues presented exclude documentation and miscellaneous revenues.

APPENDIX A

ORACLE CORPORATION
Q1 FISCAL 2009 FINANCIAL RESULTS
EXPLANATION OF NON-GAAP MEASURES

To supplement our financial results presented on a GAAP basis, we use the non-GAAP measures indicated in the tables, which exclude certain business combination accounting entries and expenses related to acquisitions, as well as other significant expenses including stock-based compensation, that we believe are helpful in understanding our past financial performance and our future results. Our non-GAAP financial measures are not meant to be considered in isolation or as a substitute for comparable GAAP measures and should be read only in conjunction with our consolidated financial statements prepared in accordance with GAAP. Our management regularly uses our supplemental non-GAAP financial measures internally to understand, manage and evaluate our business and make operating decisions. These non-GAAP measures are among the primary factors management uses in planning for and forecasting future periods. Compensation of our executives is based in part on the performance of our business based on these non-GAAP measures. Our non-GAAP financial measures reflect adjustments based on the following items, as well as the related income tax effects:

• Support deferred revenue: Business combination accounting rules require us to account for the fair value of support contracts assumed in connection with our acquisitions. Because these are typically one-year contracts, our GAAP revenues for the one year period subsequent to our acquisition of a business do not reflect the full amount of software license updates and product support revenues on assumed support contracts that would have otherwise been recorded by the acquired entity. The non-GAAP adjustment is intended to reflect the full amount of such revenues. We believe this adjustment is useful to investors as a measure of the ongoing performance of our business because we have historically experienced high renewal rates on support contracts, although we cannot be certain that customers will renew these contracts.

• Stock-based compensation expenses: We have excluded the effect of stock-based compensation expenses from our non-GAAP operating expenses and net income measures. Although stock-based compensation is a key incentive offered to our employees, and we believe such compensation contributed to the revenues earned during the periods presented and also believe it will contribute to the generation of future period revenues, we continue to evaluate our business performance excluding stock-based compensation expenses. Stock-based compensation expenses will recur in future periods.

• Amortization of intangible assets expenses: We have excluded the effect of amortization of intangibles expenses from our non-GAAP operating expenses and net income measures. Amortization of intangible assets expenses is inconsistent in amount and frequency and is significantly affected by the timing and size of our acquisitions. Investors should note that the use of intangible assets contributed to revenues earned during the periods presented and will contribute to future period revenues as well. Amortization expenses will recur in future periods.

• Acquisition related and other expenses, and restructuring expenses: We incurred significant expenses in connection with our acquisitions and also incurred certain other operating expenses or income, which we generally would not have otherwise incurred in the periods presented as a part of our continuing operations. Acquisition related and other expenses consist of in-process research and development expenses, personnel related costs for transitional employees, stock-based compensation expenses (in addition to the stock-based compensation expenses described above), integration related professional services, certain business combination contingency adjustments after the purchase price allocation period has ended, and certain other operating expenses, net. Substantially all of the stock-based compensation expenses included in acquisition related and other expenses resulted from unvested options assumed in acquisitions whose vesting was fully accelerated upon termination of the employees pursuant to the original terms of those options. Restructuring expenses consist of Oracle employee severance and other exit costs. We believe it is useful for investors to understand the effects of these items on our total operating expenses. Although acquisition related expenses and restructuring expenses are not recurring with respect to past acquisitions, we generally will incur these expenses in connection with any future acquisitions.