Oracle: Eat My Dust, IBM

“We’re growing dramatically faster than our competitors, and our target really is to beat IBM. If we maintain our trajectory and IBM maintains their trajectory, we could pass them as early as the end of this year or certainly next year to be the No. 2 player in middleware.” Oracle CEO Larry Ellison made that prediction in September 2007, and a little over a year later it’s come to pass–according to Ellison, anyway. During a conference call to discuss the company’s second-quarter results, which hit Wall Street’s earnings targets despite the souring economy, Ellison noted that strong sales of Oracle’s (ORCL) Fusion middleware have brought it into parity with IBM (IBM). “We believe we are at least the same size as IBM in middleware, and we may, in fact, have passed them to be the number one middleware company,” Ellison said. “If we haven’t passed them, we are very, very close in terms of revenue and our middleware business is growing dramatically faster then IBM’s middleware revenue.”

Clearly, Oracle’s acquisition binge strategy, which has provided it with more customers and more recurring revenue, has proven a wise one. No surprise, then, that Ellison said the company continues to look for takeover targets. “Some companies have much more attractive valuations right now but I’m not sure they’d be wildly enthusiastic about selling for cash at this point in time,” he said. “So we’re going to wait and see how things play out and we’re looking at a number of small acquisitions in the vertical areas and some potential opportunities for a large company acquisition if the price is right.”