Stock Analysis on Net
Stock Analysis on Net

Oracle Corp. (NYSE:ORCL)

Analysis of Goodwill and Intangible Assets

Microsoft Excel

Goodwill and Intangible Asset Disclosure

Oracle Corp., balance sheet: goodwill and intangible assets

US$ in millions

Microsoft Excel
May 31, 2023 May 31, 2022 May 31, 2021 May 31, 2020 May 31, 2019 May 31, 2018
Developed technology 4,300 3,966 4,237 4,471 5,406 5,309
Cloud services and license support agreements and related relationships 9,456 5,260 5,497 5,589 5,693 5,999
Cloud license and on-premise license agreements and related relationships 2,688 356 — — — —
Other 3,582 865 1,269 1,341 1,589 1,622
Intangible assets, gross 20,026 10,447 11,003 11,401 12,688 12,930
Accumulated amortization (10,189) (9,007) (8,573) (7,663) (7,409) (6,260)
Intangible assets, net 9,837 1,440 2,430 3,738 5,279 6,670
Goodwill 62,261 43,811 43,935 43,769 43,779 43,755
Intangible assets and goodwill 72,098 45,251 46,365 47,507 49,058 50,425

Based on: 10-K (reporting date: 2023-05-31), 10-K (reporting date: 2022-05-31), 10-K (reporting date: 2021-05-31), 10-K (reporting date: 2020-05-31), 10-K (reporting date: 2019-05-31), 10-K (reporting date: 2018-05-31).

Item Description The company
Intangible assets, net Sum of the carrying amounts of all intangible assets, excluding goodwill, as of the balance sheet date, net of accumulated amortization and impairment charges. Oracle Corp. intangible assets, net decreased from 2021 to 2022 but then increased from 2022 to 2023 exceeding 2021 level.
Goodwill Amount after accumulated impairment loss of an asset representing future economic benefits arising from other assets acquired in a business combination that are not individually identified and separately recognized. Oracle Corp. goodwill decreased from 2021 to 2022 but then increased from 2022 to 2023 exceeding 2021 level.
Intangible assets and goodwill Sum of the carrying amounts of all intangible assets, including goodwill, as of the balance sheet date, net of accumulated amortization and impairment charges. Oracle Corp. intangible assets and goodwill decreased from 2021 to 2022 but then increased from 2022 to 2023 exceeding 2021 level.

Adjustments to Financial Statements: Removal of Goodwill

Oracle Corp., adjustments to financial statements

US$ in millions

Microsoft Excel
May 31, 2023 May 31, 2022 May 31, 2021 May 31, 2020 May 31, 2019 May 31, 2018
Adjustment to Total Assets
Total assets (as reported) 134,384 109,297 131,107 115,438 108,709 137,264
Less: Goodwill 62,261 43,811 43,935 43,769 43,779 43,755
Total assets (adjusted) 72,123 65,486 87,172 71,669 64,930 93,509
Adjustment to Total Oracle Corporation Stockholders’ Equity (deficit)
Total Oracle Corporation stockholders’ equity (deficit) (as reported) 1,073 (6,220) 5,238 12,074 21,785 45,726
Less: Goodwill 62,261 43,811 43,935 43,769 43,779 43,755
Total Oracle Corporation stockholders’ equity (deficit) (adjusted) (61,188) (50,031) (38,697) (31,695) (21,994) 1,971

Based on: 10-K (reporting date: 2023-05-31), 10-K (reporting date: 2022-05-31), 10-K (reporting date: 2021-05-31), 10-K (reporting date: 2020-05-31), 10-K (reporting date: 2019-05-31), 10-K (reporting date: 2018-05-31).

Oracle Corp., Financial Data: Reported vs. Adjusted

Adjusted Financial Ratios: Removal of Goodwill (Summary)

Oracle Corp., adjusted financial ratios

Microsoft Excel
May 31, 2023 May 31, 2022 May 31, 2021 May 31, 2020 May 31, 2019 May 31, 2018
Total Asset Turnover
Reported total asset turnover 0.37 0.39 0.31 0.34 0.36 0.29
Adjusted total asset turnover 0.69 0.65 0.46 0.55 0.61 0.43
Financial Leverage
Reported financial leverage 125.24 — 25.03 9.56 4.99 3.00
Adjusted financial leverage — — — — — 47.44
Return on Equity (ROE)
Reported ROE 792.45% — 262.43% 83.94% 50.87% 8.37%
Adjusted ROE — — — — — 194.06%
Return on Assets (ROA)
Reported ROA 6.33% 6.15% 10.48% 8.78% 10.20% 2.79%
Adjusted ROA 11.79% 10.26% 15.77% 14.14% 17.07% 4.09%

Based on: 10-K (reporting date: 2023-05-31), 10-K (reporting date: 2022-05-31), 10-K (reporting date: 2021-05-31), 10-K (reporting date: 2020-05-31), 10-K (reporting date: 2019-05-31), 10-K (reporting date: 2018-05-31).

Financial ratio Description The company
Adjusted total asset turnover An activity ratio calculated as total revenue divided by adjusted total assets. Oracle Corp. adjusted total asset turnover ratio improved from 2021 to 2022 and from 2022 to 2023.
Adjusted ROA A profitability ratio calculated as net income divided by adjusted total assets. Oracle Corp. adjusted ROA deteriorated from 2021 to 2022 but then slightly improved from 2022 to 2023.

Oracle Corp., Financial Ratios: Reported vs. Adjusted

Adjusted Total Asset Turnover

Microsoft Excel
May 31, 2023 May 31, 2022 May 31, 2021 May 31, 2020 May 31, 2019 May 31, 2018
As Reported
Selected Financial Data (US$ in millions)
Revenues 49,954 42,440 40,479 39,068 39,506 39,831
Total assets 134,384 109,297 131,107 115,438 108,709 137,264
Activity Ratio
Total asset turnover1 0.37 0.39 0.31 0.34 0.36 0.29
Adjusted for Goodwill
Selected Financial Data (US$ in millions)
Revenues 49,954 42,440 40,479 39,068 39,506 39,831
Adjusted total assets 72,123 65,486 87,172 71,669 64,930 93,509
Activity Ratio
Adjusted total asset turnover2 0.69 0.65 0.46 0.55 0.61 0.43

Based on: 10-K (reporting date: 2023-05-31), 10-K (reporting date: 2022-05-31), 10-K (reporting date: 2021-05-31), 10-K (reporting date: 2020-05-31), 10-K (reporting date: 2019-05-31), 10-K (reporting date: 2018-05-31).

2023 Calculations

1 Total asset turnover = Revenues ÷ Total assets
= 49,954 ÷ 134,384 = 0.37

2 Adjusted total asset turnover = Revenues ÷ Adjusted total assets
= 49,954 ÷ 72,123 = 0.69

Activity ratio Description The company
Adjusted total asset turnover An activity ratio calculated as total revenue divided by adjusted total assets. Oracle Corp. adjusted total asset turnover ratio improved from 2021 to 2022 and from 2022 to 2023.

Adjusted Financial Leverage

Microsoft Excel
May 31, 2023 May 31, 2022 May 31, 2021 May 31, 2020 May 31, 2019 May 31, 2018
As Reported
Selected Financial Data (US$ in millions)
Total assets 134,384 109,297 131,107 115,438 108,709 137,264
Total Oracle Corporation stockholders’ equity (deficit) 1,073 (6,220) 5,238 12,074 21,785 45,726
Solvency Ratio
Financial leverage1 125.24 — 25.03 9.56 4.99 3.00
Adjusted for Goodwill
Selected Financial Data (US$ in millions)
Adjusted total assets 72,123 65,486 87,172 71,669 64,930 93,509
Adjusted total Oracle Corporation stockholders’ equity (deficit) (61,188) (50,031) (38,697) (31,695) (21,994) 1,971
Solvency Ratio
Adjusted financial leverage2 — — — — — 47.44

Based on: 10-K (reporting date: 2023-05-31), 10-K (reporting date: 2022-05-31), 10-K (reporting date: 2021-05-31), 10-K (reporting date: 2020-05-31), 10-K (reporting date: 2019-05-31), 10-K (reporting date: 2018-05-31).

2023 Calculations

1 Financial leverage = Total assets ÷ Total Oracle Corporation stockholders’ equity (deficit)
= 134,384 ÷ 1,073 = 125.24

2 Adjusted financial leverage = Adjusted total assets ÷ Adjusted total Oracle Corporation stockholders’ equity (deficit)
= 72,123 ÷ -61,188 = —

Adjusted Return on Equity (ROE)

Microsoft Excel
May 31, 2023 May 31, 2022 May 31, 2021 May 31, 2020 May 31, 2019 May 31, 2018
As Reported
Selected Financial Data (US$ in millions)
Net income 8,503 6,717 13,746 10,135 11,083 3,825
Total Oracle Corporation stockholders’ equity (deficit) 1,073 (6,220) 5,238 12,074 21,785 45,726
Profitability Ratio
ROE1 792.45% — 262.43% 83.94% 50.87% 8.37%
Adjusted for Goodwill
Selected Financial Data (US$ in millions)
Net income 8,503 6,717 13,746 10,135 11,083 3,825
Adjusted total Oracle Corporation stockholders’ equity (deficit) (61,188) (50,031) (38,697) (31,695) (21,994) 1,971
Profitability Ratio
Adjusted ROE2 — — — — — 194.06%

Based on: 10-K (reporting date: 2023-05-31), 10-K (reporting date: 2022-05-31), 10-K (reporting date: 2021-05-31), 10-K (reporting date: 2020-05-31), 10-K (reporting date: 2019-05-31), 10-K (reporting date: 2018-05-31).

2023 Calculations

1 ROE = 100 × Net income ÷ Total Oracle Corporation stockholders’ equity (deficit)
= 100 × 8,503 ÷ 1,073 = 792.45%

2 Adjusted ROE = 100 × Net income ÷ Adjusted total Oracle Corporation stockholders’ equity (deficit)
= 100 × 8,503 ÷ -61,188 = —

Adjusted Return on Assets (ROA)

Microsoft Excel
May 31, 2023 May 31, 2022 May 31, 2021 May 31, 2020 May 31, 2019 May 31, 2018
As Reported
Selected Financial Data (US$ in millions)
Net income 8,503 6,717 13,746 10,135 11,083 3,825
Total assets 134,384 109,297 131,107 115,438 108,709 137,264
Profitability Ratio
ROA1 6.33% 6.15% 10.48% 8.78% 10.20% 2.79%
Adjusted for Goodwill
Selected Financial Data (US$ in millions)
Net income 8,503 6,717 13,746 10,135 11,083 3,825
Adjusted total assets 72,123 65,486 87,172 71,669 64,930 93,509
Profitability Ratio
Adjusted ROA2 11.79% 10.26% 15.77% 14.14% 17.07% 4.09%

Based on: 10-K (reporting date: 2023-05-31), 10-K (reporting date: 2022-05-31), 10-K (reporting date: 2021-05-31), 10-K (reporting date: 2020-05-31), 10-K (reporting date: 2019-05-31), 10-K (reporting date: 2018-05-31).

2023 Calculations

1 ROA = 100 × Net income ÷ Total assets
= 100 × 8,503 ÷ 134,384 = 6.33%

2 Adjusted ROA = 100 × Net income ÷ Adjusted total assets
= 100 × 8,503 ÷ 72,123 = 11.79%

Profitability ratio Description The company
Adjusted ROA A profitability ratio calculated as net income divided by adjusted total assets. Oracle Corp. adjusted ROA deteriorated from 2021 to 2022 but then slightly improved from 2022 to 2023.