Oracle Blames Third-Quarter Miss on Sales Execution

Oracle Blames Third-Quarter Miss on Sales Execution

Shares of business software giant Oracle have fallen by more than 8 percent today following a third-quarter earnings report that surprised analysts by missing expectations on several fronts.

In a conference call yesterday, CFO Safra Catz blamed the problems on issues with sales execution, due in part to all the sales people Oracle has hired in recent months: “Since we’ve been adding literally thousands of new sales reps around the world, the problem was largely sales execution, especially with the new reps, as they ran out of runway in Q3,” Catz said on the call. “As expected, many of the pushed out deals have already closed.”

Analysts today seemed willing to take that explanation at face value. “While the sales execution excuse is hardly bulletproof, we side with Oracle on this one and conclude that the issues are largely internal and can be addressed relatively quickly,” wrote BMO Capital Markets analyst Karl Keirstead in a note to clients today. “We haven’t picked up signs of a February lull in enterprise IT spend.”

Brad Reback of Stifel Nicolaus agreed. “We think the issue was not macro, competitive or product related, but due to training and productivity issues with new sales hires and their inability to close enough ‘bread and butter’ deals,” he wrote in a note today.

However, it’s hard to gauge how much of today’s decline is the result of the quarter’s results, and how much can be attributed to chatter that Oracle President Mark Hurd might, in one scenario, be tapped to run Dell.

Yesterday, Fortune reported that the private equity firm Blackstone Group is mulling a competing bid against Silver Lake Partners and Michael Dell to take that struggling computer company private. In the event that Blackstone were to win the bidding process, it would, the story goes, want Hurd for the CEO job there.

Hurd, whose previous job was running Hewlett-Packard, where he earned a reputation as an aggressive cost-cutter, hasn’t signaled his interest in such an outcome either way. But today The Wall Street Journal reported that Blackstone was in talks with GE concerning a bid on Dell’s financial services unit, meaning that the chatter about Hurd running a Blackstone-owned Dell might be just that â€" chatter.