Mark Hurd is taking a leave of absence as co-chief executive of Oracle.
David Paul Morris/Bloomberg News
Sept. 12, 2019 1:35 pm ET
By its nature and size,
is a rather steady ship. But losing even one of its captains still makes some waves. The software giant put out fiscal first-quarter results late Wednesday—a day earlier than planned—to get ahead of the news that
one of the company’s two CEOs, is taking a leave of absence for undisclosed health reasons.
The move doesn’t exactly leave Oracle rudderless; 75-year-old chairman and founder
will continue to run the company with the other co-CEO
continuing an unusual leadership structure that was formalized five years ago but was effectively in place about four years before that. In other words, losing even an executive of Mr. Hurd’s stature shouldn’t rock Oracle’s boat. But Mr. Hurd closely oversaw Oracle’s sales structure, which is no small role at a software company now in its fifth decade that is still fighting to stay relevant in a rapidly changing market for corporate technology. Oracle’s relentless focus on sales, in fact, has largely kept the company from slipping into the melting-iceberg status that has afflicted some of its other aging tech peers. Oracle’s revenue growth has averaged a little over 1% annually for the past eight fiscal years, compared with an average annual 3% decline at
But Oracle can’t rest on even those humble laurels. Current Wall Street projections have sales growing an average 2% annually over the next three years, as the company has sharpened its focus on cloud-related deals and still has a very large population of database customers to sell into. But Oracle’s first-quarter revenue was slightly below analysts’ estimates, and the company’s projection for the current quarter was merely in line. The company noted on Wednesday’s call that it recently reorganized its key North American sales force, which impacted results. Most notably, the company’s earlier forecast for accelerating revenue growth in the current fiscal year wasn’t reaffirmed. Thus, Oracle’s share price fell more than 4% Thursday morning. The company’s long history suggests its sales disruption will be short-lived. Mr. Ellison and Ms. Catz also have plenty of experience, having effectively run Oracle as a pair for years before Mr. Hurd joined in 2010. But a change at the top is still a bit jarring in a hypercompetitive market that has added tech giants such as
and Google to Oracle’s long list of nemeses. The years ahead won’t be smooth sailing.
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