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CRM Giant Salesforce Exceeds Q4 Earnings Estimates – Updates Full-Year Guidance

By John F. Heerdink, Jr.

Reportedly, Salesforce.com Inc. (CRM) reported its Q4 earnings this week, exceeding analysts’ estimates. The enterprise-software company reported adjusted earnings of $1.04 per share versus 75 cents per share as expected by analysts. Revenue stood at $5.82 billion versus $5.68 billion expected.

In December, Salesforce announced its plan to acquire Slack for over $27 billion and expects to close the deal late in the quarter ending July 31. For the full-year guidance including the impact from Slack, the company announced for $3.39 to $3.41 in adjusted earnings per share on $25.65 billion to $25.75 billion in revenue, including $600 million in revenue from Slack. Analysts expect $3.49 in adjusted earnings per share and $25.42 billion in revenue.

Salesforce expects adjusted earnings per share of 88 cents to 89 cents in the fiscal first quarter on $5.875 billion to $5.885 billion in revenue above analyst’s estimates of adjusted earnings of 76 cents per share on $5.72 billion in revenue.

“We expect recent M&A will be a 63-cent headwind to non-GAAP diluted EPS. During the quarter, we identified further opportunities to consolidate and sublease across our global portfolio including in some of our hub locations stated Amy Weaver, Salesforce’s finance chief, referring to the 2022 fiscal year.

Q4 Highlights:

  • Salesforce reported $1.36 billion in subscription and support revenue from its key Sales Cloud product for tracking sales leads, resulting in roughly 11% annualized growth in comparison to 12% in the prior quarter
  • Tableau data visualization software that the company bought in 2019 contributed to Salesforce’s $1.81 billion in subscription and support revenue from Platform and other products.
  • As the pandemic continued, Salesforce had $184 million in expenses because of ending certain real estate leases in the quarter, more than the $80 million to $100 million range Salesforce had said to expect.
  • Salesforce had $18 billion in current remaining performance obligations at the end of the quarter, up by 20%.

Vista Partners LLC (”Vista”) is a California Registered Investment Advisor based in San Francisco. Vista delivers timely and relevant insights via the website: www.vistapglobal.com with daily stories, weekly market updates, monthly macroeconomic newsletters, podcasts, & Vista’s proprietary equity and market research to help you stay informed and stay competitive. Vista’s mission is to invest partner capital while arming investors with a comprehensive global financial perspective across all market sectors. Vista also seeks to provide select issuers with actionable advice regarding fundamental development, corporate governance, and capital market directives.

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(Read Original Story: Salesforce revenue up 20% from last year, forecast calls for similar growth rate in CNBC)


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