Salesforce.com (NYSE: CRM) recently reported its quarter’s results that continued to outpace market expectations. It also revised its outlook upwards for the year. According to Piper Jaffray, the company is the “most attractive stock” in its universe. Latest IDC results showcase how Salesforce continues to take market share away from the likes of Oracle and SAP.
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Salesforce’s Financials
For the first quarter of the year, Salesforce’s revenue grew 25% over the year to $2.39 billion, above analyst projection of $2.35 billion. EPS of $0.28 was also ahead of the market’s forecast of $0.26 for the quarter.
By segment, revenues from Subscription and support revenues grew 24% to $2.2 billion. Professional services and other revenues came in at $187 million, reporting an increase of 32% year-over-year. Within the subscription revenues, sales cloud revenues increased 14% to $829.6 million. Service cloud revenues grew 21% to $651.2 million. Platform and other revenues improved 32% to $431.1 million, and Marketing and Commerce Cloud revenues grew 56% to $289 million.
For the current quarter, Salesforce expects revenues of $2.51-$2.52 billion with an EPS of $0.31-$0.32. The market was looking for revenues of $2.48 billion and an EPS of $0.31. Salesforce raised the expectations for the year to revenues of $10.25-$10.3 billion and an EPS of $1.28-$1.30. The market had forecast revenues at $10.18 billion and an EPS of $1.29.
Salesforce AI’s Retail Focus
Salesforce is focusing huge efforts on Artificial Intelligence. Last week, it announced new Commerce Cloud Einstein innovations that will help retailers deliver personalized, AI-powered experiences for shoppers spanning the entire gamut of web, mobile, social, and in-store operations. The improvements include new Order Management features, Mobile Site Reference Architecture blueprints, and Google Android Pay integration. AI capabilities will allow retailers to offer focused product recommendations for online shoppers and smarter interactions with in-store associates.
