Tweet
November 19, 2010, 5:25 PM EST
By Aaron Ricadela
(Updates with analyst’s comment in fifth paragraph.)
Nov. 19 (Bloomberg) -- Salesforce.com Inc. rose the most in two years on the New York Stock Exchange after forecasting fourth-quarter sales that exceeded analysts’ estimates.
Revenue will be $447 million to $449 million in the quarter, which ends in January, Salesforce said yesterday in a statement. Excluding stock-based compensation and some other costs, profit will be 27 cents to 28 cents a share. Analysts had projected sales of $424.6 million and profit of 28 cents, the average of estimates compiled by Bloomberg.
Salesforce, the biggest seller of online customer- relationship management software, attracted about 28 percent more paying customers than a year earlier, reaching a total of 87,200. Chief Executive Officer Marc Benioff said he expects sales to approach $2 billion in fiscal 2012, a first for a cloud-computing company, which provides software via the Web.
Salesforce jumped $20.97, or 18 percent, to $136.74 at 4 p.m. in composite trading on the NYSE, the biggest gain since November 2008. The shares have added 85 percent this year.
“There’s a flight to quality, and there aren’t a lot of larger-cap cloud-computing companies, so most portfolios will have to have it,” said Bradley Whitt, an analyst at Gleacher & Co. in Dallas, who recommends buying the shares and doesn’t own any.
Third-Quarter Results
Third-quarter net income rose to $21.1 million, or 15 cents a share, from $20.7 million, or 16 cents, a year earlier. Sales gained 30 percent to $429.1 million, topping the average $410.5 million estimate. Profit excluding some costs was 32 cents, exceeding the projection of 31 cents.
Salesforce also is expanding its offices. The company said on Nov. 1 that it bought 14 acres of land in San Francisco for $278 million to construct a new complex. On Oct. 27, it bought the remaining outstanding shares of its Japanese subsidiary for $170 million.
Subscription and support revenue grew 31 percent to $403 million last quarter, accounting for most of the company’s sales. Professional services and other revenue climbed 10 percent to $26 million.
In fiscal 2012, which ends in January of that year, sales will be $1.97 billion to $2 billion, the company said. Analysts predicted $1.92 billion.
--Editors: Lisa Wolfson, Nick Turner
To contact the reporters on this story: Aaron Ricadela in San Francisco at aricadela@bloomberg.net
To contact the editor responsible for this story: Tom Giles at tgiles5@bloomberg.net
Powered by WizardRSS | Full Text RSS Feeds
(Updates with analyst’s comment in fifth paragraph.)
Nov. 19 (Bloomberg) -- Salesforce.com Inc. rose the most in two years on the New York Stock Exchange after forecasting fourth-quarter sales that exceeded analysts’ estimates.
Revenue will be $447 million to $449 million in the quarter, which ends in January, Salesforce said yesterday in a statement. Excluding stock-based compensation and some other costs, profit will be 27 cents to 28 cents a share. Analysts had projected sales of $424.6 million and profit of 28 cents, the average of estimates compiled by Bloomberg.
Salesforce, the biggest seller of online customer- relationship management software, attracted about 28 percent more paying customers than a year earlier, reaching a total of 87,200. Chief Executive Officer Marc Benioff said he expects sales to approach $2 billion in fiscal 2012, a first for a cloud-computing company, which provides software via the Web.
Salesforce jumped $20.97, or 18 percent, to $136.74 at 4 p.m. in composite trading on the NYSE, the biggest gain since November 2008. The shares have added 85 percent this year.
“There’s a flight to quality, and there aren’t a lot of larger-cap cloud-computing companies, so most portfolios will have to have it,” said Bradley Whitt, an analyst at Gleacher & Co. in Dallas, who recommends buying the shares and doesn’t own any.
Third-Quarter Results
Third-quarter net income rose to $21.1 million, or 15 cents a share, from $20.7 million, or 16 cents, a year earlier. Sales gained 30 percent to $429.1 million, topping the average $410.5 million estimate. Profit excluding some costs was 32 cents, exceeding the projection of 31 cents.
Salesforce also is expanding its offices. The company said on Nov. 1 that it bought 14 acres of land in San Francisco for $278 million to construct a new complex. On Oct. 27, it bought the remaining outstanding shares of its Japanese subsidiary for $170 million.
Subscription and support revenue grew 31 percent to $403 million last quarter, accounting for most of the company’s sales. Professional services and other revenue climbed 10 percent to $26 million.
In fiscal 2012, which ends in January of that year, sales will be $1.97 billion to $2 billion, the company said. Analysts predicted $1.92 billion.
--Editors: Lisa Wolfson, Nick Turner
To contact the reporters on this story: Aaron Ricadela in San Francisco at aricadela@bloomberg.net
To contact the editor responsible for this story: Tom Giles at tgiles5@bloomberg.net
Powered by WizardRSS | Full Text RSS Feeds