Oracle Plans Speedy Layoffs

Oracle Corp. will announce layoffs at PeopleSoft Inc. as soon as Friday to integrate the recently acquired company into the world’s second-largest business software maker, Oracle’s chief financial officer said Tuesday.

“On the personnel front, our goal is to get integration done this month,” Harry You said at an investors conference in New York. “It would be literally in the next few days.”

After his presentation, You would not specify how many jobs would be lost but said Oracle would do what made financial sense. Redwood City, Calif.-based Oracle completed its $10.3-billion purchase of PeopleSoft on Friday.

Industry analysts have estimated that at least 6,000 jobs may be lost at PeopleSoft. The company ended 2003 with more than 12,000 employees, according to its latest regulatory filing.

Oracle’s competitors are welcoming the move.

SAP, the leading vendor of business software, said it had seen an uptick of resumes from PeopleSoft employees in the last year. The company now has a sales executive vice president from Oracle and a business development executive from PeopleSoft.

SAP America spokesman Steve Bauer said campaigns were in the works to lure away PeopleSoft customers.

Sybase Inc. said that it was actively hiring and that some of its job applicants were from PeopleSoft, which is located close by.

“There are lots of talented people at PeopleSoft, and we are happy to take advantage of any of those people coming over that happen to come,” Sybase spokeswoman Leslie Nakajima said.

Oracle is expected to cut 80% of sales jobs and as much as 90% of administrative positions at PeopleSoft but keep the bulk of its research and development team, said Richard Davis, managing director of Needham & Co.

You said there was much room for improvement in PeopleSoft’s business, such as how it handled sales. Oracle learned over the holiday season when combing through PeopleSoft’s financial records that 80% of its license revenue did not come until the last day of the quarter.

Oracle makes 40% of its revenue and earnings in the last month of the quarter, You said. A rush to clinch deals at the end of the quarter often leads to discounting, analysts have said. The business software sector has faced pricing pressures and slow demand in recent years because of tight technology budgets.

Nevertheless, You said Oracle’s pipeline, which is industry jargon for new business opportunities, “looks pretty darn good.”

SAP on Tuesday met sales forecasts for the fourth quarter but disappointed a market used to SAP beating expectations.

Oracle’s stock, which fell as much as 1% in earlier trading, rose 1 cent to $13.20 on Nasdaq.