Can Oracle Deliver Another Earnings Surprise?

Business software giant Oracle reports fiscal Q3 earnings today after the markets close, and investors are wondering if it can deliver another positive surprise the way it did in December.

Analysts surveyed by Thomson Reuters expect Oracle to report per-share earnings of 68 cents on revenue of $9.46 billion, and to offer Q4 guidance of 94 cents per share on revenue of $11.43 billion.

There are several challenges facing the company, including a strong U.S. dollar. When the American dollar is strong relative to other currencies like the euro and Japanese yen, U.S. companies lose out after converting those currencies to dollars, impacting revenue.

Karl Keirstead, an analyst with Deutsche Bank Securities, said in a March 12 research note that he expects Oracle’s to take a 5 percent hit on currency effects alone, higher than the 4 percent Oracle has previously said it expected, mainly because the dollar has only strengthened since December. Given the effect of currencies, he expects revenue to decline year on year by 1 percent.

Currencies aside, there’s also the sales environment for enterprise hardware. Hewlett-Packard, IBM and EMC have all reported weak results or guidance recently. That could imply similar struggles at Oracle, though a survey of Oracle resellers conducted by Brent Thill, an analyst UBS Securities, found that most of Oracle’s sales partners were upbeat.

“Substantially all large partners expect stable to stronger sales trends and pipelines going into the next fiscal quarter,” Thill wrote.

In December Oracle defied expectations and beat the Street consensus by a penny a share after falling short for three straight quarters. It was seen as a good omen following a management shift in which Mark Hurd and Safra Catz replaced founder Larry Ellison in the CEO slot. Ellison is now CTO and Chairman.

This article originally appeared on Recode.net.