) recently introduced the Oracle Solution for Project-Driven Supply
Chain to help its customers enhance project performance and
increase profitability in the process.
The new solution integrates Oracle Value Chain Planning and
Oracle's Primavera project portfolio management solutions.
Oracle Value Chain Planning applications help supply chain managers
to sense and shape demand, optimize promotions for growth, perform
fast event-driven scenario analysis, and get a handle on supply
Oracle's Primavera currently focuses on providing web-based
Enterprise Project Portfolio Management software that encompasses
resource allocation, cost reduction, supply-chain efficiency, and
decision-making -- using real-time data for businesses.
This integration, in turn, will help organizations in balancing and
adjusting their material and manufacturing capacity decisions to
better adhere to project milestones and avoid unexpected delays and
The new solution is also expected to enable organizations to
develop a single planning and execution strategy that will unify
the interests of all project stakeholders and drive consistent and
We believe that the new initiative will prove fruitful for the
company and will attract more businesses, thereby driving Oracle's
profitability going forward.
Further, we believe that the speedy adoption of engineered systems
and cloud suites will drive incremental top-line growth in 2015.
However, Oracle's continuing transition from licensing where
revenues are recognized upfront to a cloud subscription model where
it is recognized over the years will hurt the top line in the near
Nonetheless, higher Software-as-a-service (SaaS) &
platform-as-a-service (PaaS) adoption is expected to provide a
recurring revenue base over the long term. However, increasing mix
of lower-margin IaaS will hurt profitability.
We believe that Oracle's cloud business will continue to face stiff
competition from Workday and Salesforce.com (
). In ERP, SAP AG (
) remains a dominant force, while in the
Infrastructure-as-a-service (IaaS) segment it will compete against
the likes of Amazon. Further, hardware revenue growth will suffer
due to sluggish IT spending and competition from International
Business Machines (
Currently, Oracle has a Zacks Rank #3 (Hold).
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