DOD remains on-prem Oracle customer for HR, says Jefferies

After Bloomberg released an article indicating that the Department of Defense is terminating a plan to use Oracle (ORCL) software to manage its civilian workforce as part of the Pentagon’s cost-cutting efforts, Jefferies spoke to Oracle after the Bloomberg article came out to clarify the details. The company confirmed that while the DOD did downsize its plans to move its human resource workloads from on-premise to the cloud, it will remain an on-premise customer and will continue its maintenance/support contracts with Oracle, the analyst tells investors. Oracle indicated that Defense’s project became too complicated in how it was being implemented from a services perspective and that component has been cut, but that the actual on-premise HR software contract remains intact, added Jefferies, which says “the headlines read more negatively than the fundamental impact.” Jefferies keeps a Buy rating and $220 price target on Oracle shares.