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Test Code : 1Z0-338
Test designation : Oracle Exadata Database Machine and Cloud Service 2017 Implementation Essen
Vendor designation : Oracle
real questions : 72 real Questions
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(EDGAR on-line by route of COMTEX) -- particular 2. management's dialogue and analysis of economic situation and results of Operations
We start administration's discussion and evaluation of monetary situation and consequences of Operations with a top flush view of their agencies, key working segments and demanding trends. This overview is adopted with the aid of a abstract of their faultfinding accounting policies and estimates that they accept as prerogative with are vital to realizing the assumptions and judgments integrated in their pronounced monetary effects. They then deliver a greater detailed analysis of their results of operations and fiscal situation.
Oracle employer gives items and capabilities that address all points of company counsel technology (IT) environments-application, platform and infrastructure. Their Oracle Cloud choices deliver a finished and wholly built-in stack of software, platform, compute, storage, and networking functions in all three primary layers of the cloud: software as a provider (SaaS), Platform as a carrier (PaaS) and Infrastructure as a service (IaaS). Their on-premise choices encompass Oracle database and middleware software, utility utility, hardware (Oracle Engineered programs, servers, storage, networking and business-particular items), and connected advocate and capabilities. They provide their cloud and on-premise choices to clients worldwide by route of deployment models that most appropriate swimsuit their wants.
Our finished and wholly built-in stack of SaaS, PaaS and IaaS offerings combine the application, hardware and capabilities on the valued clientele' behalf in IT environments that they installation, advocate and control for the client. Their integrated Oracle Cloud offerings are designed to exist swiftly deployable to enable customers shorter time to innovation; with ease maintainable to slit back integration and checking out work; connectable among differing deployment fashions to permit interchangeability and extendibility between cloud and on-premise IT environments; appropriate to effortlessly coast workloads between on-premise IT environments and the Oracle Cloud; competitively priced by means of requiring lower upfront client investment; and relaxed, requirements-primarily based and authentic. they are a leader within the core technologies of cloud IT environments, together with database and middleware application as well as trade applications, virtualization, clustering, tremendous-scale systems management and related infrastructure. Their items and capabilities are the constructing blocks of their Oracle Cloud capabilities, their partners' cloud capabilities and their consumers' cloud IT environments.
moreover featuring a wide spectrum of cloud offerings, they enhance and sell their items and functions to their clients worldwide to exist used in their world statistics facilities and on-premise IT environments. a crucial factor of their company approach is to proceed their investments in, and innovation with cherish to, their items and functions that they offer via their cloud and on-premise application, hardware and services organizations. they now absorb a profound understanding as to how all accessories inside IT environments-application, platform and infrastructure-engage and office with one an extra. They focus their construction efforts on enhancing the performance, safety, operation and integration of those differing applied sciences to accomplish them more competitively priced and simpler to deploy, control and preserve for their valued clientele and to enrich their computing performance relative to their competitors. After the initial purchase of Oracle items and capabilities, their consumers can proceed to capture talents of their analysis and progress investments and profound IT competencies with the aid of procuring and renewing Oracle help choices, which may furthermore include product enhancements that they periodically deliver to their software items, among others, and through renewing their SaaS, PaaS and IaaS contracts with us.
As valued clientele install with the Oracle Cloud, many are adopting a hybrid IT mannequin whereby positive of their IT elements are deployed and managed through the Oracle Cloud, whereas other of their IT elements are deployed and managed on-premise,and both units of supplies will furthermore exist managed as one. They focus of attention the engineering of their products and features to most efficient link these several deployment models to permit flexibility, ease, agility, compatibility, extensibility and seamlessness.
Our selective and lively acquisition software is one more crucial point of their company method. They accept as prerogative with that their acquisitions raise the items and capabilities that they can present to shoppers, extend their customer base, provide improved scale to accelerate innovation, grow their revenues and revenue, and enhance stockholder price. In fresh years, they now absorb invested billions of bucks to acquire a number of agencies, items, features and applied sciences that add to, are complementary to, or absorb otherwise improved their current offerings. all through the 2d quarter of fiscal 2017, they received NetSuite Inc. (NetSuite), which contributed to the growth in their cloud
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SaaS and PaaS revenues, amongst others, from the date of acquisition. exist vigilant 2 of Notes to Condensed Consolidated fiscal Statements, protected in other places during this Quarterly report, offers more information involving their acquisition of NetSuite. They are expecting to proceed to acquire corporations, items, functions and technologies to further their corporate method.
we now absorb three agencies that carry their application, platform and infrastructure technologies: cloud and on-premise utility, hardware and capabilities. These organizations can exist further divided into positive operating segments (observe 12 of Notes to Condensed Consolidated fiscal Statements, protected somewhere else during this Quarterly report, provides additional information regarding their working segments). each of their organizations and operating segments has unique characteristics and faces several opportunities and challenges. a top flush view of their three corporations and linked operating segments follows.
Cloud and On-Premise software company
Our cloud and on-premise utility company, which represented 80% of their complete revenues on a trailing 4-quarter groundwork, is made out of three working segments: (1) cloud utility and on-premise utility, (2) cloud IaaS and
Cloud application and On-Premise utility: Their cloud software and on-premise application line of enterprise markets, sells and offers a wide spectrum of software and platform technologies through their SaaS and PaaS choices, which might exist positive of their application applications and systems that are delivered via a cloud-primarily based IT atmosphere that they host, maneuver and assist. Their cloud software and on-premise application line of trade furthermore licenses their application items together with Oracle functions, Oracle Database, Oracle Fusion Middleware and Java, among others, for on-premise and different IT environments.
We believe that the comprehensiveness and breadth of their SaaS, PaaS and on-premise application offerings provide superior improvement to their purchasers and differentiates us from many of their opponents that offer more restrained or really helpful software choices. Their SaaS and PaaS choices are designed to exist interoperable with one one other, thereby limiting the combination and tuning of multiple cloud applications from several providers. Their SaaS and PaaS choices are designed to bring relaxed information isolation and multifarious improvements, self-carrier access controls for users, a carrier-Oriented architecture (SOA) for integration with on-premise systems, and a elevated efficiency, excessive availability infrastructure based on their infrastructure technologies including their Oracle Engineered techniques. Their on-premise utility offerings are radically designed to office on both separate server and clustered server configurations for cloud or on-premise IT environments, and to advocate a election of operating systems including Oracle Solaris, Oracle Linux, Microsoft windows and third party UNIX products, among others. Their dedication to industry requirements consequences in utility offerings that work in customer environments with Oracle or non-Oracle hardware or software accessories and that can furthermore exist tailored to meet specific trade or enterprise wants. They focal point the engineering of their products and features to most effective link cloud and on-premise deployment models to allow flexibility, ease, agility, compatibility, extensibility and seamlessness. all of these methods are designed to advocate customer option and slit back client risk. Their valued clientele encompass groups of many sizes, govt corporations, academic associations and resellers. They market and sell their cloud utility and on-premise application offerings to these customers with a revenue force placed to offer the combos that top of the line wholesome client needs. They permit clients to accommodate and transform to significantly any IT ambiance at some thing pace is most acceptable for them.
Our SaaS and PaaS revenues and new utility licenses revenues are plagued by the power of customary fiscal and trade conditions, governmental budgetary constraints, the fashion for and aggressive station of their utility choices, their acquisitions, their capability to carry and renew their SaaS and PaaS contracts with their current valued clientele and international strange money fee fluctuations. In recent periods, we've placed significant strategic emphasis on growing to exist their cloud SaaS and PaaS revenues, which has affected the growth of their cloud SaaS and
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PaaS revenues and their new utility licenses revenues and the connected charges. They prognosticate these developments will continue. Their SaaS and PaaS arrangements are often one to a few years in duration and they try to resume these contracts when they're eligible for renewal. The vast majority of their new utility license transactions are characterized by route of lengthy sales cycles and the timing of just a few huge application license transactions can greatly influence their quarterly new software licenses revenues.
Cloud utility and on-premisesoftware revenues represented 27% of their complete revenues on a trailing 4-quarter basis. Their cloud software and on-premise software phase's margin has historically trended upward over the course of the four quarters within a particular fiscal yr due to the historical upward style of their new software licenses revenues over those quarterly periods and because the majority of their expenses for this aspect are predominantly mounted within the short term. As mentioned further beneath under "Supplemental Disclosure involving inescapable charges," their cloud software and on-premise application phase's margin has been and may continue to exist affected by the unprejudiced price adjustments concerning the cloud SaaS and PaaS tasks that they assumed in their company combos and by means of the amortization of intangible assets linked to companies and technologies that we've received.
Cloud Infrastructure as aService: Their cloud IaaS segment, which represented 2% of their total revenues on a trailing 4-quarter groundwork, provides Oracle Cloud IaaS offerings, that are infrastructure cloud capabilities that are business-grade, hosted and supported within the Oracle Cloud to operate elastic compute, storage and networking services on a subscription groundwork. Their cloud IaaS aspect furthermore presents Oracle Managed Cloud features, which might exist complete software and hardware management and renovation features for customer IT infrastructure for a price for a cited term that are hosted at their Oracle information middle amenities, opt for accomplice statistics facilities or physically on-premise at customer facilities. They reliance that their Oracle Cloud IaaS choices complement their SaaS and PaaS choices and permit us to present clients extra alternatives to entry Oracle technologies throughout the Oracle Cloud to fulfill their IT wants.
software License Updates andProduct guide: utility license updates and product advocate revenues are generated in the course of the sale of utility help contracts relating to on-premise new application licenses bought through their shoppers. shoppers that buy utility license updates and product assist are granted rights to unspecified product upgrades and preservation releases and patches released throughout the time epoch of the advocate length, in addition to technical advocate information. Their utility license updates and product sheperd contracts are frequently 12 months in length. greatly all of their on-premise application license valued clientele renew their application license updates and product sheperd contracts yearly. The growth of application license updates and product assist revenues is primarily influenced by using four factors: (1) the percentage of their software sheperd constrict consumer basis that renews its software aid contracts; (2) the quantity of new software sheperd contracts offered in connection with the sale of new application licenses; (3) the amount of new utility license revenues offered; and (4) the volume of utility help contracts assumed from corporations they absorb received.
Our application license updates and product advocate section, which represented 51% of their total revenues on a trailing four-quarter basis, is their highest margin trade unit. Their application help margins over the trailing 4-quarters absorb been 93% and accounted for 87% of their total margins over the equal length. Over the long run, they accept as prerogative with that application license updates and product help revenues and margins will develop for here motives:
appreciably all new software licenses transactions result within the sale of application license updates and product assist contracts, which add to their software sheperd constrict base;
noticeably all of their on-premise new application license customers, together with purchasers from bought companies, renew their utility aid contracts when eligible for renewal; and
our acquisitions absorb increased their application help constrict base, as neatly because the portfolio of items obtainable to exist licensed and supported.
Our hardware trade is made out of two operating segments: (1) hardware items and (2) hardware guide. Their hardware enterprise represented 12% of their total revenues on a trailing four-quarter groundwork. They await our
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hardware trade to absorb subside operating margins as a percent of revenues than their cloud and on-premise software enterprise due to the incremental prices they incur to supply and distribute these items and to supply advocate capabilities, together with direct substances and labor fees. They are expecting to accomplish investments in analysis and construction to increase current hardware products and services and to develop new hardware items and functions.
Hardware products: They provide a extensive election of hardware and linked functions, together with Oracle Engineered methods, servers, storage, networking, workstations and linked gadgets, trade-specific hardware, virtualization application, operating techniques, and management utility to advocate several IT environments, together with cloud computing environments. They engineer their hardware products with virtualization and administration capabilities to enable the swift deployment and effective management of cloud and on-premise IT infrastructures. Their hardware items aid many of the world's greatest cloud infrastructures, including the Oracle Cloud.
Our hardware items are designed to exist simpler to install, manage and preserve for their shoppers and to enrich computing efficiency relative to their opponents' offerings. They design their hardware products to seamlessly connect cloud and on-premise IT environments to further permit interoperability, interchangeability and extendibility and to work in client environments that may furthermore encompass other Oracle or non-Oracle hardware or software components. Their supple and open approach gives Oracle valued clientele with a great compass of choices in how they install their hardware products, which they correspond with is a precedence for their customers.
Oracle Engineered programs are core to their hardware offerings and are essential elements of their information focus and cloud computing choices together with the Oracle Cloud. These pre-integrated products are designed to combine numerous Oracle technology components to work collectively to bring greater efficiency, availability, protection and operational efficiency relative to their competitors' products; to exist upgraded conveniently and successfully; and to simplify renovation cycles through featuring a separate acknowledge for software patching. Oracle Engineered programs are confirmed before they're shipped to valued clientele and delivered capable-to-run, enabling customers to abridge deployment time to production. They present positive of their Oracle Engineered methods technologies through bendy deployment alternate options including as a cloud carrier and for on-premise IT environments.
We offer a wide compass of server products the consume of their SPARC microprocessor. Their SPARC servers flee the Oracle Solaris operating gadget and are designed to exist differentiated by route of their reliability, security and scalability. Their mid-size and huge servers are designed to present enhanced efficiency and subside complete saturate of possession than competitive UNIX programs for enterprise faultfinding applications, for purchasers having extra computationally intensive wants, and as structures for constructing cloud computing IT environments. Their SPARC servers are furthermore a core portion of the Oracle SuperCluster, one in every of their Oracle Engineered techniques.
We additionally present commercial enterprise x86 servers. These x86 servers are based on microprocessors from Intel enterprise and are compatible with Oracle Solaris, Oracle Linux, Microsoft windows and different working programs. Their x86 servers are additionally a core portion of many of their Oracle Engineered systems including the Oracle Exadata Database desktop, Oracle Exalogic Elastic Cloud, Oracle Exalytics In-reminiscence machine and the Oracle huge statistics appliance.
Our storage products are engineered for the cloud and designed to securely save, control, protect, archive, backup and retrieve clients' mission faultfinding records property. Their storage products include disk, flash, tape, digital tape and hardware-linked software including file programs software, returned-up and archive utility, hierarchical storage management software and networking for mainframe and heterogeneous methods environments. They furthermore offer positive of their storage offerings as a cloud service.
Our networking and information focus cloth items, together with Oracle digital Networking, and Oracle InfiniBand and Ethernet technologies, are used with their server and storage items and are built-in into their management rig to assist trade purchasers increase infrastructure performance, slit back can saturate and complexity and simplify storage and server connectivity.
We present hardware products and functions designed for positive particular industries. Their point-of-sale hardware choices include point-of-sale terminals and related hardware that are designed for managing groups inside the food and beverage, lodge and retail industries, among others. Their hardware items and features for
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communications networks encompass network signaling, policy control and subscriber facts management options, and session margin manage expertise, among others.
nearly all of their hardware products are sold via circuitous channels, including impartial distributors and cost-added resellers.
to produce their hardware products, they matter on each their internal manufacturing operations as well as third birthday party manufacturing companions. Their internal manufacturing operations consist essentially of substances procurement, meeting, checking out and nice manage of their Oracle Engineered programs and inescapable of their enterprise and information core servers and storage items. For all other manufacturing, they generally matter on third birthday party manufacturing companions to provide their hardware-connected add-ons and hardware items and they can furthermore contain their internal manufacturing operations in the closing assembly, testing and nice maneuver techniques for these add-ons and items. They distribute most of their hardware products both from their amenities or companion facilities. They strive to reduce costs by using simplifying their manufacturing processes through expanded standardization of components across product varieties and a "construct-to-order" manufacturing fashion during which items generally are constructed best after shoppers absorb positioned company orders.
Our hardware products revenues, can saturate of hardware items and hardware working margins that they report are plagued by their approach for and the competitive station of their hardware items, the power of widespread fiscal and enterprise circumstances, governmental budgetary constraints, positive of their acquisitions and overseas forex fee fluctuations.
Our quarterly hardware items revenues are problematic to foretell. The timing of client orders and delays in their potential to timely manufacture or convey a number of gargantuan hardware transactions, among other factors, could extensively absorb an effect on the volume of hardware products revenues, prices and working margins that they report.
Hardware support: Their hardware help offerings provide purchasers with utility updates for application components which are elementary to the performance of their hardware products, akin to Oracle Solaris and inescapable other application products, and may include product repairs, renovation services and technical sheperd functions. typically, their hardware help constrict arrangements are priced as a percentage of the internet hardware products expenses, are invoiced to the consumer firstly of the help epoch and are 12 months in period. They continue to conform hardware advocate strategies which are intended to proactively determine and resolve imposing considerations and to increase the volume of latest and renewed hardware advocate contracts bought in connection with the revenue of their hardware items. Their hardware help revenues that they report are influenced via a few factors, together with the extent of purchases of hardware items, the pricing and blend of hardware items purchased, whether valued clientele resolve to purchase hardware help contracts at or in nearby proximity to the time of hardware product sale, the percent of their hardware sheperd constrict client basis that renews its aid contracts and their acquisitions. considerably all of these factors are closely influenced by their consumers' selections to either maintain or upgrade their present hardware infrastructure to newly developed technologies that can exist found.
Our capabilities business, which represented eight% of their total revenues on a trailing 4-quarter basis, is comprised of the remnant of their working segments. Their services trade has lessen margins than their cloud and on-premise application and hardware corporations. Their capabilities revenues are impacted by their approach for and the aggressive position of their services, inescapable of their acquisitions, customary fiscal circumstances, governmental budgetary constraints, personnel discounts in their customers' IT departments, tighter controls over discretionary spending, their strategic emphasis on transforming into their cloud revenues and the increase in their software and hardware offerings. Their features enterprise' choices include:
consulting features that are designed to advocate their consumers and international system integrator companions extra successfully architect and deploy their offerings, together with IT strategy alignment, commercial enterprise structure planning and design, initial cloud and software implementation and integration, and ongoing software enhancements and upgrades. They utilize a global, blended delivery model to optimize value for their clients and partners, consisting of on-premise consultants from local geographies, industry consultants and consultants from their world birth and acknowledge centers;
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schooling features for Oracle products and features, together with working towards and certification classes which are provided to customers, companions and employees via a number of codecs, together with teacher-led classes at their schooling facilities, are vital digital training, self-paced on-line practicing, inner most routine and customized practicing.
Our selective and energetic acquisition software is another faultfinding point of their corporate approach. In concomitant years, they absorb invested billions of dollars to purchase a few complementary agencies, items, features and applied sciences.
we absorb obtained inescapable companies and technologies all over the fiscal 2017 and 2016 durations introduced during this Quarterly document, including NetSuite. notice 2 of Notes to Condensed Consolidated fiscal Statements included in different places during this Quarterly record gives additional information regarding their fresh acquisitions.
We reckon that their acquisition application strengthens their aggressive place, enhances the products and capabilities that they are able to present to purchasers, expands their customer base, gives more advantageous scale to accelerate innovation, grows their revenues and earnings and raises stockholder value. They await to continue to acquire corporations, items, features and technologies in furtherance of their company method.
We correspond with that they can fund their pending and future acquisitions with their internally purchasable cash, money equivalents and marketable securities, money generated from operations, further borrowings or from the issuance of additional securities. They appraise the monetary absorb an impact on of any abilities acquisition with reference to revenue, operating margin, money movement and return on invested capital objectives before figuring out to stream forward with an acquisition.
crucial Accounting policies and Estimates
Our consolidated fiscal statements are organized in response to U.S. generally approved accounting concepts (GAAP) as set forth within the fiscal Accounting necessities Board's (FASB) Accounting necessities Codification (ASC), and they correspond with the a considerable number of cadaver of workers accounting bulletins and other applicable information issued by route of the U.S. Securities and exchange fee. GAAP, as set forth in the ASC, requires us to exist certain estimates, judgments and assumptions. They reliance that the estimates, judgments and assumptions upon which they depend are within your means based mostly upon tips attainable to us at the time that these estimates, judgments and assumptions are made. These estimates, judgments and assumptions can influence the pronounced quantities of assets and liabilities as of the date of the fiscal statements as smartly as the reported amounts of revenues and fees all through the intervals offered. To the extent that there are adjustments between these estimates, judgments or assumptions and genuine results, their monetary statements will exist affected. The accounting guidelines that mirror their extra colossal estimates, judgments and assumptions and which they believe are probably the most faultfinding to aid in completely figuring out and evaluating their said fiscal outcomes encompass:
Goodwill and Intangible assets-Impairment Assessments;
Accounting for revenue Taxes; and
criminal and other Contingencies.
in lots of circumstances, the accounting medicine of a particular transaction is peculiarly dictated through GAAP and does not require management's judgment in its utility. There are furthermore areas wherein administration's judgment in picking out . . .
Mar 17, 2017
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