Salesforce.com hopes to become world's 4th largest software company next year

Salesforce.com Inc (CRM.N) reported better-than-expected quarterly revenue and profit, helped by an increase in demand for its Web-based sales and marketing software, and raised its revenue forecast for the full year for the third time.

The company's shares rose about 4 percent in extended trading after the world's biggest maker of online sales software also forecast current-quarter revenue and adjusted profit above the average analyst estimates.

 Salesforce.com hopes to become worlds 4th largest software company next year

Courtesy: Salesforce

"... We'll go from being the sixth largest software company in the world to the fourth largest next year," Chief Executive Marc Benioff said on a conference call, adding that the company would only lag Microsoft Corp (MSFT.O), Oracle Corp (ORCL.N) and SAP (SAPG.DE).

Salesforce raised its revenue forecast for the year ending January 2016 to $6.60 billion-$6.63 billion from $6.52 billion-$6.55 billion.

San Francisco-based Salesforce has been gaining market share from Oracle and SAP in customer relationship management software that helps companies organize and track sales calls and leads.

Salesforce, which provides its services online, with no software directly installed on PCs, leads the global customer relationship management market, which is valued at $23 billion annually, according to tech research firm Gartner.

Salesforce revenue has been rising as businesses opt for cheaper and easier cloud software services, but higher spending, particularly on sales personnel, has pressed the bottom line.

Unbilled deferred revenue — a critical but off-balance sheet measure of contracts closed with business customers — jumped 24 percent to $6.2 billion at the end of the quarter ended July 31.

The company's net loss narrowed to $852,000 in the second quarter from $61.1 million a year earlier.

Excluding items, Salesforce earned 19 cents per share, beating the average analyst estimate of 17 cents, according to Thomson Reuters I/B/E/S.

Revenue rose 24 percent to $1.63 billion, beating analysts' average estimate of $1.60 billion.

Reuters

 

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Updated Date: Aug 21, 2015 11:29:43 IST