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Analyst adjusts to life on the other side

Former Morgan Stanley analyst Chuck Phillips talks about being on the firing line one day and on the receiving line the next, as a new senior executive at Oracle.

REDWOOD SHORES, Calif.--As he found himself face-to-face with an audience of Wall Street pros anxious to grill him about the details of Oracle's new business strategy, Charles "Chuck" Phillips noted the irony.

"It's a much different audience from this part of the stage," Phillips said with a barely hidden smile as he took the mike at an Oracle analyst briefing on Wednesday. "You didn't look so intimidating before, but now you do."

It was an unusual occasion for all present. Phillips, a former star analyst for Morgan Stanley, was making his first formal presentation to his former Wall Street colleagues now as one of Oracle's top executives. But if he had any butterflies, Phillips kept them well hidden.

"You've spoken like you've been a corporate guy for 15 years," Tad Piper, an analyst at U.S. Bancorp Piper Jaffray, later told Phillips at a cocktail reception.

Phillips, 44, left the clubby world of Morgan Stanley in May to join Oracle's executive ranks. A few weeks later, Oracle launched its hostile $6.3 billion bid to acquire rival PeopleSoft.

Since then, Phillips has emerged as one of CEO Larry Ellison's chief strategists, a role that was on full display as he fluidly handled a bevy of questions about the company's takeover plans.

The moment underscored how dramatically Phillips' role had changed from the days when he was considered one of the most influential software analysts on Wall Street, ever-ready to batter executives with tough questions. Now he was on the receiving end, watching his words as he parried with questioners.

Phillips later conceded that his first live tete-a-tete with former colleagues and competitors, many of whom he still considers friends, was "strange."

"At least I know what they're thinking," he quipped.

The camaraderie between Phillips and his old cronies was apparent from the get-go. When Phillips began taking questions, he first called upon Goldman Sachs' Richard Sherlund, who, along with Phillips, has been consistently ranked among the top software equity researchers in the country.

"All right Rick, let's get this over with," Phillips said, sitting on stage next to Safra Catz, an Oracle executive vice president.

"This is for either of you, but it is fun to address it to Chuck," Sherlund said before launching into his question.

"It creates an interesting opportunity to tease him," Sherlund noted after the question-and-answer session. "He knows what we're thinking, and we know what he can?t say. But we enjoy asking him, anyway."

Others said Oracle was lucky to land Phillips.

"Chuck lends a lot of credibility to Oracle, because he knows the lay of the land so well," said Mark Verbeck, an analyst at Smith Barney.

The investment community's huge respect for Phillips has yet to translate into a vote of confidence for Oracle and its bold designs on PeopleSoft. Before the final chapter in the takeover saga gets written, getting Wall Street behind Oracle's bid for PeopleSoft may well be Phillips' hardest test.

But analysts allowed that Phillips' credentials as a former Wall Street insider will help him navigate through any rough shoals, as Oracle looks to muster support within the investment community for its acquisition bid.

"Someone asked me if I was glad he left Morgan Stanley, because it removes a major competitor, and I said no, because Chuck, like Tiger (Woods, the professional golfer), made everyone on the field play better," said one Wall Streeter who asked to remain unidentified. "He's a class act. He's going to make a huge contribution to Oracle."