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Salesforce revenue forecast beats estimates, shares rise 7%

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FILE PHOTO: The company logo for Salesforce.com is displayed on the Salesforce Tower in New York City, U.S., March 7, 2019. REUTERS/Brendan McDermid/File Photo

(Reuters) – Salesforce.com Inc (CRM.N) forecast third-quarter revenue above Wall Street estimates on Thursday, encouraged by more companies opting for its cloud-based services, sending its shares up 7% in extended trading.

The company said it expects revenue of $4.44 billion to $4.45 billion for the current quarter, topping analysts’ expectations of $4.25 billion, according to IBES data from Refinitiv.

Salesforce has spent billions of dollars on acquisitions in the last few years, adding companies such as Tableau and MuleSoft, as it tries to protect its market share in the face of stiff competition from Microsoft Corp (MSFT.O) and Oracle Corp (ORCL.N).

Revenue from Sales Cloud, its flagship product for customer relationship management, rose 12.5% to $1.13 billion, accounting for about a third of its revenue.

Total revenue surged 22% to $4 billion in the second quarter ended July 31, compared with analysts’ estimates of $3.95 billion, according to IBES data from Refinitiv.

Net income fell to $91 million, or 11 cents per share, from $299 million, or 39 cents per share, a year earlier.

Excluding items, it earned 66 cents per share, well above analysts expectations of 47 cents per share.

The company, however, forecast a third-quarter loss of 20 cents to 21 cents per share.

Reporting by Neha Malara in Bengaluru; Editing by Anil D’Silva

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via Reuters