- Salesforce’s growth rate declines in 2023 as companies look for ways to cut costs.
- However, Salesforce stock has jumped more than 70% this year, outperforming the Nasdaq, which is up 36%.
- The stock rose further in extended trading on Wednesday.
Salesforce CEO Marc Benioff participates in a conversation about artificial intelligence and the future at the Asia-Pacific Economic Cooperation (APEC) Leaders Week in San Francisco, California, on November 16, 2023.
Andrew Caballero Reynolds | AFP | Getty Images
Salesforce shares rose 7% in extended trading Wednesday following the cloud software vendor’s report Third quarter fiscal earnings Which exceeded analysts’ estimates.
Here’s how the company did:
- Earnings: $2.11 per share, adjusted, versus $2.06 per share expected by LSEG.
- he won: $8.72 billion versus $8.72 billion expected by LSEG
Revenue rose 11% from $7.84 billion a year ago. Salesforce, which has historically expanded at more than 20% annually, has seen its growth rates decline in recent quarters as companies sought to reduce spending due to economic uncertainty and rising interest rates.
However, the stock has jumped more than 70% this year, outperforming the Nasdaq, which is up 36%. This is largely because Salesforce has been able to boost profits by cutting expenses. In January, the company announced it would cut jobs by 10% and reduce some office space as part of a restructuring plan.
Salesforce on Wednesday raised its 2024 fiscal forecast for operating cash flow growth to 33% from 30%. It also said fiscal fourth-quarter revenue would rise about 10% to between $9.18 billion and $9.23 billion. Analysts were expecting revenue of $9.21 billion, according to LSEG.
“We had another strong quarter executing on the profitable growth plan we began last year, generating $8.7 billion in revenue and once again raising our operating margin guidance for this fiscal year,” Salesforce CEO Marc Benioff said in the press release.
In its largest unit, which provides customer support, Salesforce saw revenue jump 12% to $2.07 billion. Revenues in the sales software segment also rose 12% to $1.9 billion. Platform and other revenue, including Slack, rose 11% to $1.69 billion.
Salesforce shares rose to $246.50 after the earnings report. At this level, they are about 20% below the high they hit two years ago.
He watches: Marc Benioff, Salesforce CEO: When I talk to CEOs, they’re all about Slack first
“Explorer. Unapologetic entrepreneur. Alcohol fanatic. Certified writer. Wannabe tv evangelist. Twitter fanatic. Student. Web scholar. Travel buff.”
