Oracle Outperforms

Oracle shares shot higher in after-hours trading Tuesday after the company’s quarterly results solidly beat Wall Street estimates.

Oracle grew sales 27% in the quarter to $4.41 billion, beating $4.33 billion forecasts, and pro forma earnings of 25 cents a share were two cents ahead of estimates. New license sales — an important indicator of future growth — were also stronger than expected, up 17% for databases and middleware and up 57% for applications.

“Not only are we growing faster than BEA, we’re now larger than they are in the middleware business,” boasted CEO Larry Ellison in a statement, and President Charles Phillips added that the company is closing in on SAP in the applications business.

Oracle shares gained 4% in late trading.

Adobe , meanwhile, saw its shares gain 2% on its numbers.

Adobe’s sales of $649.4 million were below $655.6 million estimates, while pro forma earnings of 30 cents a share were a penny better than expected, but traders are looking past the current quarter to new releases such as Creative Suite 3.

“As Adobe prepares for the biggest product launch in our history, we are excited about our opportunities and bullish about our prospects for another year of strong performance,” CEO Bruce Chizen said in a statement.

Adobe’s current quarter sales out look of $700-$740 million compared favorably to $717 million estimates.

The broader market posted more gains Tuesday on better than expected housing starts and optimism ahead of Wednesday’s Federal Reserve decision on interest rates.

Affiliated Computer surged 17% on an offer to go private, and Palm continued to gain on takeover speculation. Eschelon Telecom gained 13% on a buyout offer.

Silicon Motion and Progress Software gained on their earnings news.

Rambus climbed 6% on a favorable FTC ruling.

Systemax tumbled on its results.

The Nasdaq rose 14 to 2408, the S&P 500 gained 9 to 1411, and the Dow climbed 62 to 12,288. Volume declined to 2.76 billion shares on the NYSE, but rose to 1.78 billion on the Nasdaq. Advancing issues led by a 23-9 margin on the NYSE, and 19-10 on the Nasdaq. Upside volume was 71% on the NYSE, and 73% on the Nasdaq. New highs-new lows were 152-19 on the NYSE, and 95-64 on the Nasdaq.

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