Workday Goes Public at $4.5 Billion Valuation

Yet another enterprise cloud software company, Workday, is all set to go public today. It has raised $637 million, by selling close to 22.8 million shares for $28 each. It will have a public float of around 14% after the IPO. It will be listed on the NYSE with the ticker “WDAY”, and currently has a valuation of $4.5 billion.

Workday’s primary offering is a cloud-based financial management and human resource management solution, which is used by more than 340 enterprise clients.

It generated close to $120 million in revenue in the first six months of 2012, but is yet to turn a profit.

While most consumer internet IPOs in the last couple of years have floundered, enterprise software companies have seen a warm reception at the public markets. Companies like Palo Alto Networks and Splunk have performed much better than the likes of Facebook, Zynga or Groupon.

Workday competes primarily with the likes of Oracle, SAP and Salesforce.com. As the cloud wars heat up, Workday might even end up being a hot acquisitiont target for one of the biggies.

via Bloomberg

Oracle Reports Q1FY13 Earnings; $8.2 Billion in Revenue, $2 Billion in Net Profit

Oracle has announced its earnings for Q1FY13, with total revenues down 2% to around $8.2 billion. While software revenues grew marginally, the hardware and services revenue was down significantly, weighing down on overall revenue growth.

Its operating income increased 7% to more than $2.8 billion, while its net income jumped up to $2 billion.

With its new acquisitions and product roadmap, Oracle seems to be focused on dominating the cloud-based software space.

Oracle CEO, Larry Ellison, said:

“A little more than a week from now we will announce lots of enhancements to the Oracle Cloud. There are more CRM, ERP and HCM applications as a service, and more Oracle database, Java and social network platform services. Our new infrastructure as a service is available in the Oracle Cloud and as a private cloud in our customers’ data center, with the unique ability to move applications and services back and forth between the two.”

Oracle’s cash, cash equivalents, and marketable securities have increased to almost $31.5 billion. Its operating cash flow this quarter was up to $14 billion.

Oracle President, Mark Hurd, said:

“Exadata, Exalogic, Exalytics and our other engineered systems grew more than 100% in the quarter. For the full year, we expect to double engineered systems sales to well over $1 billion. Oracle’s new cloud business is also approaching a $1 billion annual run rate. These two businesses will drive Oracle’s growth for years to come.”

For now, it seems that cloud-based enterprise software and engineered systems will continue to drive revenue growth for Oracle in the coming years.

via Oracle – SEC

Oracle Acquires SelectMinds to Bolster Cloud HR Offerings

Oracle has resumed its acquisition spree, and acquired yet another enterprise cloud startup, SelectMinds, which is a provider of cloud-based employee recruitment and HR services.

According to Oracle’s official press release, “SelectMinds’ applications enable organizations to empower recruiters, hiring managers and employees to leverage social connections to distribute job opportunities, source higher quality referrals, market their employment brand and manage corporate alumni relationships.”

SelectMinds will enable it to add more capabilities to Taleo’s feature set and offer a more comprehensive solution to enterprise customers — one that leverages social channels like Facebook and Twitter, as well as their employees existing social networks to improving their hiring capabilities.

“The combination of Oracle and SelectMinds’ complementary social sourcing capabilities is expected to create a comprehensive recruiting, candidate sourcing, and talent management offering for organizations to reach quality referrals through social recruiting.”

Oracle competes in this space with the likes of SAP, Salesforce.com, and a lot of other smaller players. This is yet another acquisition by the giant to leverage the cloud and “social” to improve its enterprise software offerings.

The exact terms of the acquisition haven’t been announced yet, but they should be reflected in Oracle’s next earnings release.

via Oracle

Workday Files for $400 Million IPO

Workday is a cloud based enterprise software company which was founded by the founders of PeopleSoft after it was acquired by Oracle in 2005. It provides cloud based applications for enterprise functions like “human capital management (HCM), payroll, financial management, time tracking, procurement and employee expense management.”

In its S-1 filing, it states that:

“We achieved this leadership position [in the enterprise cloud space] through our innovative and adaptable technology, focus on the consumer Internet experience and cloud delivery model. Further, we believe we are the only company to provide this complete set of unified cloud-based applications to enterprises. Our applications are designed for global enterprises to manage complex and dynamic operating environments. We provide our customers highly adaptable, accessible and reliable applications to manage critical business functions that enable them to optimize their financial and human capital resources.”

WorkDay competes primarily with the likes of Oracle, SAP, Salesforce.com and NetSuite, besides a number of other heavyweights in this space. It has more than 1450 employees, and reported close to $135 million in revenue in the year ended January 31, 2012. It posted a net loss, however, of $80 million. It ended July 31, 2012 with around $122 million in cash.

It plans to raise close to $400 million in the IPO, and we expect it to continue to make losses in the years following the IPO, as it operates in a very competitive environment, before eventually turning a profit.

You can check out the entire Workday S-1 filing here: Workday – SEC

IBM Buys Kenexa for $1.3 Billion

IBM is one of the latest tech giants to have scooped up a company in the booming social enterprise software space. It has acquired Kenexa, a social human resources, talent acquisition and management software company, for $1.3 billion.

Kenexa’s software enables corporate customers to handle performance management, compensation, career development, leadership training and all such boring HR stuff with a social twist. Kenexa is one of the more formidable players in the enterprise cloud apps space led by Salesforce.com. IBM competes with the likes of Oracle and SAP, who are also trying desperately to gain a foothold in this market. Oracle recently acquired Taleo, while SAP acquired SuccessFactors in a bid to dominate the space.

Kenexa’s products are used by more than 9000 companies across industries, and will complement IBM’s existing offerings.

IBM’s official statement says:

“The acquisition bolsters IBM’s leadership in helping clients embrace social business capabilities while gaining actionable insights from the enormous streams of information generated from social networks every day.

Kenexa, a leading provider of recruiting and talent management solutions, brings a unique combination of Cloud-based technology and consulting services that integrates both people and processes, providing solutions to engage a smarter, more effective workforce across their most critical business functions.

Kenexa complements IBM’s strategy of bringing relevant data and expertise into the hands of business leaders within every functional department, from sales and marketing to product development and human resources. As a result of this synergy, clients will be able to attract and develop the right skills to build the right teams, for the right projects, the first time.”

via Techcrunch

Jury Rules That Google Hasn’t Infringed Oracle Patents With Android

In the Google-Oracle billion dollar lawsuit case, the jury has come out with its decision: Google has not infringed Oracle’s patents with Android. Oracle was looking to get $6 billion from the lawsuit. However, now it will go home without the billions. Continue reading Jury Rules That Google Hasn’t Infringed Oracle Patents With Android

Oracle’s Final Damage Claim Against Google May Be Less than $100 Million

Oracle, which was claiming billions of dollars in damages from Google in a patent infringement lawsuit concerning the use of Java in Android, may have to make do with a lot less.

Oracle jumped into the patent wars by claiming that Google infringed upon its patents by using parts of the Java programming language in Android. It initially demanded $6 billion in damages, a figure which was declared ridiculous by the presiding judge.

After that, it reduced its claims to $2 billion, but even that was apparently quite high. Google has been claiming that the damages would add up to around $37.5 million to $46.6 million, which is way lower than what Oracle thinks it deserves.

Even if Oracle manages to up the damages figure a bit, it will likely be under $100 million, which is chump change for Google.

Google and its partners have been attacked by a number of technology giants, including Apple, Microsoft and Oracle, for developing and using Android. At least in the Oracle case, it seems that Google may have scored a minor victory. We’ll know for sure only after the case goes to trial.

Check out the complete details at Groklaw.

Oracle Takes Another Blow in the Android Patent Infringement Case

Oracle sued Google back in August 2010, expecting to walk away with big spoils of war. Instead, Google wrote to the patent and trademark office asking them to re-examine all patents in connection with the case, and this has caused Oracle to lose many patents it acquired from Sun Microsystems. Clearly, this case costed Oracle considerably in monetary and reputation damages. However, it continues pursuing the case hoping to have a positive turnout.

google-oracle

In December last year, the Patent and Trademark Office (PTO), on request for a re-examination by Google, invalidated a major Oracle patent. A few days back, Oracle received another blow in this case, when the PTO voided one more of its patents. Finally, Oracle regained some sense and decided to withdraw the claim 14 on the patent ‘467, but we can see that the damage has been done! This makes the entire ‘467 patent out of the scope of this lawsuit.

Moreover, for the third time in a row, Oracle has come up with inflated damage reports claiming more than the applicable reasonable amount. The initial claim from Oracle was a ridiculous 6 billion USD, which has come down to 52.4 – 169 million USD. Google is still not satisfied with these estimates, and has filed a motion to cut this damage list and hence the claim amount, shorter.

Groklaw mocks this whole case with this interesting argument.

Oracle bought Sun, everything Sun had, for what Oracle said was a transaction valued at “approximately $7.4 billion, or $5.6 billion net of Sun’s cash and debt”. That’s hardware, MySQL, Solaris, many things beyond just Java. So how could just six, now five, Java patents out of Sun’s more than 500 Java patents alone, add up to $6 billion? Why did anyone ever think this was a realistic figure instead of just hype?

At present, the PTO has confirmed only four of twenty-six Oracle claims. Oracle walked into the case without proper preparation, and is facing the consequences now. I just have one advice for Oracle. Stop already, and leave with the patents you can still call yours.

Oracle: Google Makes $10 Million from Android Everyday

Oracle is one of the few tech giants which isn’t directly competing in the smartphone market but is still involved in patent wars with Google over Android. Oracle had sued Google over the use of Java IP in Android back in 2010, and was demanding billions of dollars in damages and licensing fees. Over the last couple of months, it seemed like it was fighting a losing battle, as some of its patent claims were rejected by the USPTO.

However, Oracle isn’t giving up just yet. According to FOSSPatents, Oracle is pressing the court to set an early hearing for its copyright claim against Google, to get an injunction as soon as it can.

Some new information has surfaced which reveals how Oracle valued Google’s Android business in its lawsuit.

Currently, close to 700,000 Android devices are activated every day. According to Oracle, each day’s worth of Android activations generate nearly $10 million in mobile advertising revenue for Google.

This translates into approximately $3.65 billion dollars in mobile advertising revenue for Google through Android alone, according to Oracle. Oracle’s figures are based on an estimated annual advertising revenue of $14 per Android user, and this is just the directly generated revenue. The tech giant further states that:

“This revenue does not even include all the other value Android generates for Google, ranging from Android Market revenue, to other Android-related services, to ensuring that Google will not be locked out of the mobile business, to lucrative relationships with manufacturers of myriad devices on which Android can and does run, to the inordinately valuable access Android provides to customers for its new social network service, Google+. Indeed, Android has enabled Google to wield such power with regard to search and other services that its Android distribution and licensing practices — far from the ‘open’ practices Google has proclaimed it lives by — are under investigation by competition law agencies in the United States, Europe and elsewhere.”

These numbers seem to be inflated and based on flawed estimates. We should see more details on how much money Google actually makes from Android once the trial starts. The more Google makes from Android, the more Oracle will claim in damages and license fees.

US Patent and Trademark Office Rejects Oracle’s Patent Related to Android’s Java Infringement

In August last year, Oracle sued Google over its use of Java in Android. Oracle claimed that Google infringed upon Oracle’s Java patents, being fully aware of the infringement. A tough battle ensued, and Oracle and Google are battling it out in the court for one year now, without any results.
oracle-java
While this battle was ongoing, Java founder James Gosling joined and left Google. The Lindholdm email revealed some important facts and Groklaw has presented  an analysis  of the entire matter. In addition to those events, Google appealed to the Patent and Trademark office (PTO) to re-check Oracle Java patents. The re-examination was favorable for Google, as now, the PTO has rejected some of Oracle’s Java patents.

Google claims  that,

The reexaminations of five of the six patents-in-suit remain ongoing, with roughly two-thirds of the currently asserted claims having been rejected. Eighty percent of the asserted claims as to which the PTO has issued an office action currently stand rejected.

Although Oracle is allowed to claim infringement on the invalidated patents, this rejection complicates the case even further. Google has created an empire and a new business line over Android, and it is not willing to give up so easily. At the same time, Oracle is not ready to let go of the jackpot it can earn from this infringement case.

Most of the patents mentioned in the Google vs. Oracle case are related to codes that improve Java performance in Android’s Dalvik virtual machine. However, the PTO has invalidated a patent that was supposed to expire in 2025, making it the youngest of the lot, and the most profitable one for Oracle. This case is costing Oracle more in monetary (or patent) and reputation damages, and more than it can profit from the infringement claims.