Salesforce.com (NYSE: CRM), the biggest seller of online customer- relationship management software, is scheduled to release its fourth-quarter earnings after the closing bell on Thursday, Ferbruary 24, 2011. Analysts, on average, expect the company to report earnings of 26 cents per share on revenue of $452.69 million. In the year ago quarter, the company reported earnings of 16 cents per share on revenue of $354.05 million.
Salesforce.com, Inc. is a provider of enterprise cloud computing applications. Salesforce.com is best known for its Customer Relationship Management (CRM) products. Salesforce uses cloud technology, which is a part of the Software as a Service (SaaS) model. Cloud computing refers to the use of Internet-based computing, storage and connectivity technology for a variety of different services.
In the preceding third-quarter, the San Francisco, California based-company's net income was $21.1 million, or 15 cents a share, compared with a profit of $20.7 million, or 16 cents a share, in the year-earlier quarter. On an adjusted basis, the company earned 32 cents a share in the latest quarter. Revenue surged 30% to $429 million from $330.55 million. Analysts, on average, expected the company to report earnings of 31 cents per share on revenue of $410.46 million.
At its last earnings call in November, the company said that it expects fourth-quarter GAAP earnings of 6 cents to 7 cents per share, non-GAAP earnings of 27 cents to 28 cents per share, and revenue of $447 million to $449 million. The company also raised its guidance for the full year 2011. For the full year 2011, the company now expects GAAP earnings of 46 cents to 47 cents per share, non-GAAP earnings of $1.18 to $1.19 per share, and revenue of $1.647 billion to $1.649 billion. For the full year 2012, the company said that it anticipates revenues in the range of $1.97 billion to $2.0 billion.
The company is poised to benefit from the fast growth of cloud computing CRM software market. The favorable factors for this tremendous growth are speed and ease of implementation and low total cost of ownership. More companies are moving toward the "cloud computing" model, which essentially means accessing data and computing power over the Internet rather than on local hardware. The company has positioned itself well for "Cloud 2," which is the evolutionary progression of software-as-a-service, and should be a formidable company for a long time.
In December, the company introduced Database.com, a storehouse for information that developers can use to build online applications. Database.com will help the company cater to developers who build applications that run across network-connected computers and step up its rivalry with Oracle and other software makers.
In the last four years, Salesforce.com has made about a dozen acquisitions to broaden its product offerings. In December, the company announced plans for its biggest purchase yet, a $212 million deal in cash to buy Heroku, a growing service for developers of the Ruby on Rails programming language. The acquisition is expected to have no impact to salesforce.com's fiscal fourth quarter revenue. However, the company expects the acquisition to reduce non-GAAP EPS by approximately $0.02 in the quarter ending Jan. 31, 2011. The company currently expects no material revenue contribution from the acquisition during its fiscal 2012. The company currently projects the acquisition to reduce non-GAAP EPS by approximately $0.12 to $0.13 in the year ending Jan. 31, 2012. Last month, it completed its acquisition of Dimdim for about $31 million in cash, net of cash acquired. Dimdim's current offerings allow users to host or attend live online meetings, demos and webinars using just a web browser. Salesforce.com expects the acquisition to have no material impact to its fiscal fourth quarter revenue. However, the company expects the acquisition to reduce non-GAAP earnings per share by about $0.01 in the quarter ending January 31, 2011. The company currently expects no material revenue contribution from the acquisition during its fiscal 2012. The company currently projects the acquisition to reduce non-GAAP earnings per share about $0.04 to $0.05 in the year ending January 31, 2012.
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