Sales­force beats es­ti­mates on cloud-based ser­vices

The Gulf Today - Business - - INTERNATIONAL -

NEW YORK: Sales­ eas­ily beat an­a­lysts’ es­ti­mates for quar­terly earn­ings and fore­cast 2020 rev­enue above ex­pec­ta­tions, as it ben­e­fits from more com­pa­nies turn­ing to its cloud-based ser­vices.

The com­pany’s shares rose 5.8 per cent in ex­tended trad­ing, set to add to their about 25 per cent gain this year. The re­sults and fore­cast are ex­pected to sup­port other cloud com­put­ing stocks, which took a knock ear­lier this month on con­cerns of peak­ing de­mand.

Sales­force re­mained the world­wide cus­tomer re­la­tion­ship man­age­ment mar­ket leader in the first half of 2018 with a 20.3 per cent of to­tal rev­enue share, ac­cord­ing to re­search firm IDC, but is fac­ing ris­ing com­pe­ti­tion from Mi­crosoft Cor­po­ra­tion, Or­a­cle and SAP.

San Fran­cisco-based Sales­force said it ex­pects full-year 2020 rev­enue be­tween $15.90 bil­lion and $16 bil­lion. An­a­lysts were ex­pect­ing $15.83 bil­lion, ac­cord­ing to IBES data from Refini­tiv.

“The com­pany guided for rev­enue above con­sen­sus es­ti­mates for next year, which is the first time they have done that in three years,” said Alex Zukin, an an­a­lyst with Piper Jaf­fray & Co.

The beat and fore­cast also helped over­shadow light cur­rent-quar­ter ex­pec­ta­tions. The com­pany said it ex­pected fourth quar­ter profit of be­tween 54 cents and 55 cents per share, on rev­enue of $3.55 bil­lion to $3.56 bil­lion.

An­a­lysts on av­er­age are ex­pect­ing a profit of 57 cents and rev­enue of $3.52 bil­lion.

“The mag­ni­tude of the thirdquar­ter beat was so big and more than off­sets the guid­ance,” said Scott Berg, an an­a­lyst at Need­ham & Co.

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