Salesforce.com (NYSE:CRM) fourth quarter earnings came in better than expected having benefited from a surge in demand for web-based and marketing software. Revenues beat estimates as earnings per share topped consensus estimates. The company has since upped its full-year outlook as it continues to gain traction on the cloud.
Signing Big Deals
The maker of online sales software continues to benefit from more businesses buying cheaper and easier to use cloud software. A sunny outlook for the year comes as a surprise as other technology firms remain wary of a slowdown that has hit the sector. Salesforce seems to be on another level having painted a different picture.
The company continues to expand deals with customers most of which it expects to shore up its earnings going forward. Charles Schwab is one of the companies the software giant is banking on as well as Unilever. CEO, Marc Benioff, says they signed up two huge 9-figure deals in the quarter and over 600 seven-figure deals.
Salesforce does not expect any economic impact on its fortunes going forward. That is part because they are not paying a great deal of attention to the information technology department which continues to experience some weaknesses.
Technology companies selling infrastructure equipment that fall under IT budget continue to cry foul over the level of spending in the sector. Salesforce, which is betting big on cloud software, does not expect such weaknesses to have a big impact on its earnings.
Salesforce Earnings and Outlook
Salesforce posted revenues of $1.81 billion for the fourth quarter against analysts’ estimates of $1.79 billion. Net loss came in at $25.5 million or 4 cents a share but excluding special items, the company says it earned 19 cents a share. Cloud software sales were up by 12.3% in the quarter to highs of $708.9 million.
Salesforce has since raised its full-year forecast to between $8.08 billion and $8.12 billion from an initial forecast of $8.0 billion to $8.1 billion. It also expects earnings of between 99 cents and $1.01 a share against estimates of 99 cents a share.
Anthony Young
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