Excluding one-time costs, which include losses from an investment in Liberate Technologies, Oracle earned $386 million, or 7 cents per share for the first quarter, compared with profits of $511 million, or 9 cents per share, a year ago.
Financial analysts expected the company to report earnings of 7 cents a share, according to First Call. Including one-time costs, the company earned $343 million, or 6 cents per share.
Revenue for the quarter ending Aug. 31 fell 10 percent, from $2.27 billion a year ago to $2.03 billion this year.
Oracle Chief Financial Officer Jeff Henley predicted a second-quarter profit of 8 cents to 9 cents per share with overall revenue down 4 percent to 7 percent. He expects new software license sales to drop 10 percent to 15 percent.
Henley said the company would continue to cut costs to try to weather the tech spending slump. He said the company cut 600 jobs in the first quarter, about 1.4 percent of the company's total work force of about 42,000 people. The company expects to cut another 500 to 600 jobs in the second quarter, mostly in international divisions, he said.
"Visibility beyond the upcoming quarter is minimal...Our assumption for the second half of the year (is that) we will see improvement," Henley said. "I hope we will start seeing positive, although modest, license growth in the second half. Our assumption throughout the next quarter (is) we don't expect sharp improvement."
Oracle shares were down on the news, falling to $8.41 in after-hours trading, according to the latest numbers on the Island ECN Web site. They closed at $9.03, down 25 cents before the company announced quarterly results.
Henley said international sales, particularly in Europe and Asia, were hit hardest in the first quarter. Revenue from new software licenses and renewals from database, application server software and business application software fell 9 percent to $1.2 billion. Excluding revenue from renewals, however, new software license revenue fell 23 percent. Product support revenue was down 1 percent to $349 million.
Consulting revenue fell 18 percent to $432 million, and education sales dropped 28 percent to $63 million.
New first-quarter sales of database software fell 9 percent year over year to $921 million, while business application software revenue fell 8 percent year over year to $246.5 million, Oracle executives said.
Despite the tough economy, Oracle Chief Executive Larry Ellison said the company continues to gain new customers with its technology.
Ellison said he expects half of Oracle's overall database customers to upgrade to Oracle's 9i database this year. The company released the second version of the 9i database earlier this summer.
Ellison also said 1,000 customers have purchased Oracle's highly marketed database clustering technology, called Real Application Clusters. Some 100 customers are using it on computing systems now, with a quarter of them using it on the Linux operating system. Clustering allows businesses to harness multiple servers to run a large database, allowing servers to share work or take over from one another if one fails.
Ellison added that Oracle now has 13,000 customers using the company's business applications software, called the 11i E-Business Suite, which includes software for running financial, customer service and manufacturing operations. He added that Oracle's Collaboration Suite, which offers e-mail and calendaring software, has enjoyed heavy customer interest, but it was too soon to gauge its financial success because the product was just released.