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Salesforce.com's stock soars to all-time high after it posts a good quarter and CEO vows to double revenue

Salesforce.com just reported its quarterly earnings and it hit both revenue and profit expectations on the money.

The company also offered new guidance, sending the stock soaring to an all-time high of over $68, a pop of about 9% in after-hours trading.

It reported earnings per share of $0.14, analysts were looking for $0.14, so that's in line.

It reported sales of $1.44 billion and that's in line too.

Salesforce.com Marc Benioff
Salesforce.com CEO Marc Benioff Business Insider/Julie Bort

Analysts were actually looking for a giant leap in profits over the year ago quarter when it reported $0.07 EPS on $1.15 billion in revenue.

Management says they now expect revenue for the company’s full fiscal year to come in at $6.475 billion to $6.520 billion, an increase of 20% to 21% year-over-year, and that includes a foreign exchange headwind of approximately $175 to $200 million.

Analysts had been estimating $6.50 billion, so that's in line, but there had been fears that Salesforce.com would lower guidance, instead of match it.

“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," CEO and cofounder Marc Benioff vowed in the press release.

Management expects revenue next quarter to be $1.485 billion to $1.505 billion, an increase of 21% to 23% year-over-year. Analysts had estimated $1.5 billion, so that's right in line, too.

Here's the press release:

Salesforce Announces Fiscal 2015 Fourth Quarter and Full Year Results

Surpasses $5 Billion in Annual Revenue Faster Than Any Other Enterprise Software Company

PR Newswire

25 February 2015

•          Quarterly Revenue of $1.44 Billion, up 26% Year-Over-Year

•          Full Year Revenue of $5.37 Billion, up 32% Year-Over-Year

•          Deferred Revenue of $3.32 Billion, up 32% Year-Over-Year

•          Unbilled Deferred Revenue of Approximately $5.7 Billion, up 27% Year-Over-Year

•          Full Year Operating Cash Flow of $1.17 Billion, up 34% Year-Over-Year

•          Initiates First Quarter Revenue Guide of $1.485 - $1.505 Billion

•          Raises FY16 Revenue Guidance Range to $6.475 Billion to $6.520 Billion

Salesforce (NYSE: CRM), the Customer Success Platform and world’s #1 CRM company, today announced results for its fiscal fourth quarter and full fiscal year ended January 31, 2015.

“Salesforce delivered yet another year of exceptional growth, with revenue, deferred revenue and operating cash flow all growing more than 30%, while exceeding our expectations in non-GAAP operating margin improvement,” said Marc Benioff, Chairman and CEO, Salesforce. “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.”

Salesforce delivered the following results for its fiscal fourth quarter and full fiscal year 2015:     

Revenue:  Total Q4 revenue was $1.44 billion, an increase of 26% year-over-year, and 29% in constant currency.  Subscription and support revenues were $1.35 billion, an increase of 25% year-over-year.  Professional services and other revenues were $99 million, an increase of 41% year-over-year. 

Full fiscal year 2015 revenue was $5.37 billion, an increase of 32% year-over-year, and 33% in constant currency. Subscription and support revenues were $5.01 billion, an increase of 31% year-over-year. Professional services and other revenues were $360 million, an increase of 46% year-over-year.

Earnings per Share:  Q4 GAAP loss per share was ($0.10), and diluted non-GAAP earnings per share was $0.14. The company’s non-GAAP results exclude the effects of $152 million in stock-based compensation expense, $40 million in amortization of purchased intangibles, $8 million in net non-cash interest expense related to the company’s convertible senior notes, and are based on a projected long-term non-GAAP tax rate of 36.5%.  GAAP EPS calculations are based on a basic share count of approximately 637 million shares. Non-GAAP EPS calculations are based on approximately 647 million diluted shares outstanding during the quarter.

For the full fiscal year 2015, GAAP loss per share was ($0.42), and non-GAAP diluted earnings per share was $0.52.  The company’s non-GAAP results exclude the effects of $565 million in stock-based compensation expense, $155 million in amortization of purchased intangibles, $16 million in gains on sales of land and building improvements, $47 million in net non-cash interest expense related to the company’s convertible senior notes, including the related loss on conversions of our convertible 0.75% senior notes, due 2015, and are based on a projected long-term non-GAAP tax rate of 36.5%.  GAAP EPS calculations are based on a basic share count of approximately 624 million shares. Non-GAAP EPS calculations are based on approximately 652 million diluted shares outstanding during the quarter, including approximately 15 million shares associated with the company’s convertible 0.75% senior notes due 2015 and related warrants.

Cash:  Cash generated from operations for the fiscal fourth quarter was $332 million, an increase of 22% year-over-year.  For the full fiscal year 2015, operating cash flow totaled $1.17 billion, up 34% year-over-year. Total cash, cash equivalents and marketable securities finished the quarter at $1.89 billion.

Deferred Revenue:  Deferred revenue on the balance sheet as of January 31, 2015 was $3.32 billion, an increase of 32% year-over-year, and 35% in constant currency. Unbilled deferred revenue, representing business that is contracted but unbilled and off balance sheet, ended the fourth quarter at approximately $5.7 billion, up 27% year-over-year.

As of February 25, 2015, the company is initiating revenue and EPS guidance for its first quarter of fiscal year 2016, and initiating EPS guidance for its full fiscal year 2016. In addition, the company is raising its full fiscal year 2016 revenue guidance previously provided on November 19, 2014.

Q1 FY16 Guidance:  Revenue for the company’s first fiscal quarter is projected to be approximately $1.485 billion to $1.505 billion, an increase of 21% to 23% year-over-year.

GAAP loss per share is expected to be in the range of ($0.04) to ($0.03), while diluted non-GAAP EPS is expected to be in the range of $0.13 to $0.14.  The non-GAAP estimate excludes the effects of stock-based compensation expense, expected to be approximately $138 million, amortization of purchased intangibles related to acquisitions, expected to be approximately $40 million, net non-cash interest expense related to the 0.25% convertible senior notes, due 2018, expected to be approximately $6 million, and lease termination resulting from the first quarter purchase of an office building, expected to be a gain of approximately $42 million.  EPS estimates assume a GAAP tax rate of approximately 390%, which reflects the estimated quarterly change in the tax valuation allowance, and a projected long-term non-GAAP tax rate of 36.5%.  Note that the tax valuation allowance adds complexity, causing potential volatility in our forecasted GAAP tax rate.  The GAAP EPS calculation assumes an average basic share count of approximately 653 million shares, and the non-GAAP EPS calculation assumes an average fully diluted share count of approximately 668 million shares.

Full Year FY16 Guidance:  Revenue for the company’s full fiscal year 2016 is projected to be approximately $6.475 billion to $6.520 billion, an increase of 20% to 21% year-over-year, which includes an FX headwind of approximately $175 to $200 million.

GAAP loss per share is expected to be in the range of ($0.16) to ($0.14) while diluted non-GAAP EPS is expected to be in the range of $0.67 to $0.69.  The non-GAAP estimate excludes the effects of stock-based compensation expense, expected to be approximately $617 million, amortization of purchased intangibles related to acquisitions, expected to be approximately $158 million, gains on sales of land and building improvements of approximately $18 million, net non-cash interest expense related to the 0.25% convertible senior notes, due 2018, expected to be approximately $25 million, and lease termination resulting from the first quarter purchase of an office building, expected to be a gain of approximately $42 million.  EPS estimates assume a GAAP tax rate of approximately 351%, which reflects the estimated annual change in the tax valuation allowance, and a projected long-term non-GAAP tax rate of 36.5%. Note that the tax valuation allowance adds complexity, causing potential volatility in our forecasted GAAP tax rate.  The GAAP EPS calculation assumes an average basic share count of approximately 662 million shares, and the non-GAAP EPS calculation assumes an average fully diluted share count of approximately 679 million shares.

Operating cash flow growth for the company’s full fiscal year 2016 is projected to be approximately 22% to 23% year-over-year.

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