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Oracle's stock dropped almost 8% after it gave a disappointing earnings forecast

Investors did not respond well to Oracle's second-quarters earning guidance.

Investors weren't happy with Oracle's latest earnings forecast and made their feelings known Friday.

Oracle's stock fell as much as 8.2% in regular trading before closing at $48.74, down $4.05 or 7.7%.

Investors were responding to the company's latest quarterly report, issued Thursday, in which it offered disappointing guidance for its cloud revenue and profits for its second fiscal quarter.

Oracle forecast its cloud revenue would increase between 39% and 43% in the quarter. That may be fast-paced, but it would represent a slowdown from the 51.4% pace at which its cloud revenue grew in its just-completed first quarter.

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Oracle has been struggling to catch up with Amazon and Microsoft in cloud services, and investors have been closely scrutinizing its efforts.

The company also predicted that its per-share earnings in the second quarter will be between $0.64 and $0.68. Prior to the report, analysts were predicting the company would earn $0.68 per share in the period.

The disappointing news from Oracle may be partly a result of expectations that had gotten too high. Things were looking good for the company in June when it reported its cloud revenue in its fourth quarter had grown 58%. That spurred analysts to boost their price targets for the company's stock to $54.84 per share.

Friday's sell-off of Oracle's stock could affect more than just general shareholders. Last week, the company revealed an update to its executive compensation program that ties the pay of founder Larry Ellison and joint CEOs Safra Catz and Mark Hurd to the performance of its stock and its success in the cloud market.

To meet their pay targets —$103.7 million each in 2022, or $20.74 million annually — the team must get Oracle's stock to an average price of $80 per share for at least 30 days before 2022 and hit $20 billion in total cloud revenues in one fiscal year. Oracle's total cloud revenues in 2017 were $4.57 billion.

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