Picture credit: Salesforce
Cloudy software provider Salesforce has announced its latest financial results, with $5.37bn (£3.46bn) in total annual revenue and another billion dollar quarter.
The results were in line with Wall Street’s expectations, with earnings per share at $0.14 and a year on year growth of 26.1%.
It certainly seems a long way since 2009, when Salesforce’s first billion dollar annual figures arrived, and late 2013, when the first billion dollar quarter arrived. CEO Marc Benioff saw the latter, understandably, as a major achievement initially – it’s now almost de facto.
“Salesforce delivered yet another year of exceptional growth, with revenue, deferred revenue and operating cash flow all growing more than 30%,” Benioff said in a statement. “Salesforce reached $5 billion in annual revenue faster than any other enterprise software company and now it’s our goal to be the fastest to reach $10 billion.”
Gross profit for Q414 ended at $1.09bn, up from $871,000 this time last year, while annual gross profit stood at $4.23bn, an increase of 25% from 2013’s $3.39bn.
Shares of Salesforce shot up as much as 10% in the aftermath of the news, yet the analysts were keeping their powder relatively dry. Tim Beyers, of the Motley Fool, said the company’s deferred revenue figures looked good – understandably given their main selling point is subscription based – yet added if balance grew more slowly compared to deferred revenue in the future, it “could suggest the company is having a tougher time signing the sorts of lucrative, multi-year deals Benioff wants.”
Kara Ordway, senior market dealer at City Index Australia, told CloudTech the results were “no great surprise” yet added the market was “pleasantly surprised” by Salesforce’s hike in its revenue outlook range.
“Going forward Salesforce looks well positioned to take advantage of one of the fastest growing markets in technology and is set to reap the benefits of its expansion into the fast growing European markets,” she said. “However Salesforce is yet to fully explore the advantages of geographic revenue diversity which is where the opportunity sits for the future.”
Ordway added: “Salesforce performed in line with expectations, however those forecasts were already well above the previous year’s results. With such an upbeat outlook, investors were particularly keen to jump on board.”
2014 highlights for Salesforce included the launch of the Salesforce1 app, as well as the opening of a first UK data centre, with further European expansion on the horizon. The company has also announced a global agreement with Sage with employees of the business management provider using Salesforce’s Customer Success Platform, as well as an update to its Desk.com product, which is now available in more than 50 languages.