WASHINGTON (dpa-AFX) - Cloud computing solutions provider Salesforce.com (CRM), Thursday posted a profit for the second quarter turning around from a loss last year, helped mainly by a 31 percent revenue growth as well as a hefty tax benefit. Earnings for the quarter came in ahead of Wall Street estimates, as did revenues.
Moving ahead, Salesforce.com raised its revenue and adjusted earnings outlook for the fiscal year 2014. The company's also issued a strong financial outlook for the third quarter, indicated to better Wall Street's current expectations. Following the news, share of the company rallied 8 percent on the NYSE.
Salesforce.com, which competes with Oracle Corp. and Sap AG, said total revenues for the quarter grew 31 percent to $957.1 million from $731.6 million last year, benefited in part by the acquisition of ExactTarget. Thirty analysts polled by Thomson Reuters estimated revenues of $939.25 million for the quarter.
Salesforce.com last month closed the $2.5 billion acquisition of marketing software company ExactTarget, with an intent to accelerate growth at its Salesforce Marketing Cloud.
Subscription and support revenues, the major contributor to the top line, surged 31 percent, while professional services rose 23 percent.
As of July 31, 2013, deferred revenue was $1.79 billion, an increase of 34 percent on a year-over-year basis.
Salesforce.com's second-quarter profit rose to $76.6 million or $0.12 per share, compared to a loss of $9.8 million or $0.02 per share last year.
The San Francisco, California-based company's adjusted earnings declined to $56.3 million or $0.09 per share from $60.7 million or $0.10 per share last year. On average, 37 analysts expected earnings of $0.07 per share for the quarter. Analysts' estimates typically exclude special items.
Looking forward to the third quarter, the company expects a loss of $0.19 to $0.18 per share, adjusted earnings of $0.08 to $0.09 per share, and revenues of $1.05 billion to $1.06 billion. Analysts currently estimate earnings of $0.07 per share on revenues of $1.04 billion for the quarter.
Chief Executive Marc Benioff said, 'I'm delighted to announce that just four years after delivering our first $1 billion revenue year, we are now poised to deliver our first $1 billion revenue quarter in the third quarter of fiscal 2014.'
For the full year 2014, the company now expects loss of $0.44 to $0.42 per share, adjusted earnings of $0.32 to $0.34 per share and revenues of $4.00 billion to $4.03 billion.
Previously, the company expected adjusted earnings of $0.31 to $0.33 per share and revenues of $3.96 billion to $4.00 billion.
Analysts currently expect earnings of $0.33 per share on revenues of $3.99 billion for the full year 2014.
CRM closed Thursday's trading at $43.65, up $0.87 or 2.03%, on the NYSE. The stock further gained $3.50 or 8.02% in the after-hours trade.
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