Oracle reported quarterly earnings and revenue that missed analysts' expectations on Thursday, sending shares lower in extended-hours trading.
The company posted fiscal fourth-quarter earnings, excluding items, of 92 cents per share, up from 87 cents a share in the year-earlier period.
Revenue increased to $11.32 billion from $10.95 billion a year ago.
Analysts had expected the company to report earnings, excluding items, of 95 cents a share on $11.48 billion in revenue, according to a consensus estimate from Thomson Reuters.
The software maker said its quarterly profit fell 4.2 percent to $3.65 billion from $3.81 billion a year ago.
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After the earnings announcement, the company's shares fell as much as 8 percent in after-hours trading.
As of Thursday's close, Oracle shares had gained more than 23 percent over the last 12 months. (Click here to get the latest quotes.)
"It's a bit of a jaw-dropper, in terms of Oracle missing results across the board in its historically strong fiscal year-end quarter,'' said FBR analyst Dan Ives. "It's like Spain getting knocked out of the World Cup in its first week.''
Smaller, aggressive companies like Salesforce.com and Workday have been offering competitive software and Internet-based products at prices that often undercut Oracle.
"As our business has transitioned, more software revenues are being recognized over the life of a subscription rather than upfront," Oracle President Safra Catz said, in a statement. She noted that the company has been transitioning to cloud subscriptions and "ratable revenue recognition."
Oracle said new software licenses, which account for about 33 percent of its revenue, were valued at $3.77 billion in the quarter, unchanged from a year earlier.
The software maker had forecast that part of its market would range between flat and a 10 percent gain in its fourth quarter.
Investors scrutinize new software sales because they generate high-margin, long-term maintenance contracts and are an important indicator of future profit.
Earlier this week, reports surfaced that Oracle has been in talks to buy hotel and retail software maker Micros Systems for about $5 billion.
Reuters contributed to this report.