2014

Salesforce.com Announces Fiscal Third Quarter Results First Enterprise Cloud Computing Company to Exceed $1.3 Billion Annual Revenue Run Rate

- Record Revenue of Approximately $331 Million, up 20% Year-Over-Year

- GAAP EPS of $0.16, up 100% Year-Over-Year

- Operating Cash Flow of $36M, up 107% Year-Over-Year

- Record 4,700 Net New Customers During the Quarter

- Total Customers at 67,900, up 31% Year-Over-Year

- Total Cash and Marketable Securities of $1.07 Billion, up $265 Million Year-Over-Year

- Company Raising Full Year Revenue Guidance to Approximately $1.29 Billion

- Company Raising Full Year GAAP EPS Guidance to Approximately $0.62 to $0.63

SAN FRANCISCO, Nov. 17 /PRNewswire-FirstCall/ -- Salesforce.com (NYSE: CRM), the enterprise cloud computing company, today announced results for its fiscal third quarter ended October 31, 2009.

(Logo: http://www.newscom.com/cgi-bin/prnh/20050216/SFW105LOGO)

"We are pleased to report record revenue, profit, and customer additions in Q3," said Marc Benioff, chairman and CEO, salesforce.com. "This gives us fantastic momentum as we head into Dreamforce, where we will announce our biggest product news of the year."

Salesforce.com delivered the following results for its third quarter, fiscal year 2010:

Revenue: Total Q3 revenue was $330.5 million, an increase of 20% on a year-over-year basis. Subscription and support revenues were $306.9 million, an increase of 21% on a year-over-year basis. Professional services and other revenues were $23.7 million, an increase of 3% on a year-over-year basis.

Earnings per Share: Q3 GAAP diluted earnings per share were approximately $0.16, including approximately $20.4 million in stock-based compensation expense and approximately $2.6 million in amortization of purchased intangibles related to previously announced acquisitions. For purposes of the Q3 GAAP EPS calculation, there was an average of approximately 129 million diluted shares outstanding during the quarter.

Customers: Net paying customers rose approximately 4,700 during the quarter to finish at approximately 67,900. Compared with the year ago quarter, net paying customers have grown by approximately 16,100 or 31%.

Cash: Cash generated from operations for the fiscal third quarter was approximately $36 million, up approximately 107% year-over-year. Total cash, cash equivalents and marketable securities finished the quarter at approximately $1.07 billion, an increase of approximately $265 million from the year prior.

Deferred Revenue: Deferred revenue on the balance sheet as of October 31, 2009 was $545 million, an increase of 16% on a year-over-year basis.

As of November 17, 2009, salesforce.com is initiating guidance for its fourth quarter, fiscal year 2010. For its full fiscal year 2010, the company is raising its prior revenue and EPS guidance. In addition, the company is initiating revenue guidance for its full fiscal year 2011.

Q4 FY10: Revenue for the company's fourth fiscal quarter is projected to be in the range of approximately $340 million to approximately $342 million. GAAP diluted EPS is expected to be in the range of approximately $0.14 to approximately $0.15. Stock-based compensation expense is expected to be approximately $26 million, and amortization of purchased intangibles of previously announced acquisitions is expected to be approximately $2.6 million. For purposes of the Q4 GAAP EPS calculation, the company is expecting an average diluted share count of approximately 132 million shares, a GAAP tax rate of approximately 40% and a noncontrolling interest charge of approximately $1.5 million.

Full Year FY10: The company today is raising the full year revenue guidance it provided on August 20, 2009 with revenue now expected to be approximately $1.292 billion to approximately $1.294 billion. The company is also raising its earnings outlook for the full year, expecting GAAP diluted EPS to be in the range of approximately $0.62 to approximately $0.63. Stock-based compensation expense is expected to be approximately $89 million, and amortization of purchased intangibles of previously announced acquisitions is expected to be approximately $9.9 million. For purposes of the full fiscal year 2010 GAAP EPS calculation, the company is expecting an average diluted share count of approximately 127 million shares, a GAAP tax rate of approximately 42%, and a noncontrolling interest charge of approximately $3.5 million.

Full Year FY11: The company is initiating revenue guidance for its full fiscal year 2011 with projected revenue growth in the range of approximately 15% to 16% when compared to projected fiscal year 2010. The company expects to update this guidance, as well as provide its expectations for FY11 GAAP EPS when it announces its fourth quarter, fiscal year 2010 results planned for February, 2010.

Quarterly Conference Call

Salesforce.com will host a conference call to discuss its third quarter fiscal 2010 results at 2:00 p.m. Pacific Standard Time today. A live audio webcast of the conference call, together with detailed financial information, can be accessed through the company's Investor Relations Web site at http://www.salesforce.com/investor. In addition, an archive of the webcast can be accessed through the same link. Participants who choose to call in to the conference call can do so by dialing domestically 866-901-SFDC or 866-901-7332 and internationally at 706-902-1764. A replay will be available at (800) 642-1687 or (706) 645-9291, passcode 39679783, until midnight (EST) December 8, 2009.

About salesforce.com

Salesforce.com is the enterprise cloud computing company. The company's portfolio of Salesforce CRM applications, available at http://www.salesforce.com/products/, has revolutionized the ways that companies collaborate and communicate with their customers across sales, marketing and service. The company's Force.com Platform (http://www.salesforce.com/platform/) enables customers, partners and developers to quickly build powerful business applications to run every part of the enterprise in the cloud. Based on salesforce.com's <http://salesforce.com> real-time, multi-tenant architecture, Salesforce CRM and Force.com offer the fastest path to customer success with cloud computing.

As of October 31, 2009, salesforce.com manages customer information for approximately 67,900 customers including Allianz Commercial, Dell, Dow Jones Newswires, Japan Post, Kaiser Permanente, KONE, and SunTrust Banks.

Any unreleased services or features referenced in this or other press releases or public statements are not currently available and may not be delivered on time or at all. Customers who purchase salesforce.com applications should make their purchase decisions based upon features that are currently available. Salesforce.com has headquarters in San Francisco, with offices in Europe and Asia, and trades on the New York Stock Exchange under the ticker symbol "CRM". For more information please visit http://www.salesforce.com, or call 1-800-NO-SOFTWARE.

"Safe harbor" statement under the Private Securities Litigation Reform Act of 1995: This press release contains forward-looking statements about expected revenue and GAAP earnings per share for the fourth fiscal quarter of 2010 and the full fiscal year, expected revenue for fiscal year 2011, and our expected tax rate, stock-based compensation expense, amortization expense, noncontrolling interest charge, and shares outstanding, the achievement of which involve risks, uncertainties and assumptions. If any such risks or uncertainties materialize or if any of the assumptions prove incorrect, our results could differ materially from the results expressed or implied by the forward-looking statements we make.

The risks and uncertainties referred to above include - but are not limited to - risks associated with possible fluctuations in our financial and operating results, rate of growth and anticipated revenue run rate; errors, interruptions or delays in our service or our Web hosting; breaches of our security measures; the financial impact of any future acquisitions; the nature of our business model; our ability to continue to release, and gain customer acceptance of, new and improved versions of our service; successful customer deployment and utilization of our existing and future services; changes in our sales cycle; competition; various financial aspects of our subscription model; unexpected increases in attrition or decreases in new business; the emerging market in which we operate; our ability to hire, retain and motivate our employees and manage our growth; changes in our customer base; technological developments; regulatory developments; litigation; unanticipated changes in our effective tax rate; and fluctuations in the number of shares we have outstanding, the price of such shares, foreign currency exchange rates, interest rates, and general developments in the economy, financial markets, and credit markets.

Further information on these and other factors that could affect our financial results is included in the reports on Forms 10-K, 10-Q and 8-K and in other filings we make with the Securities and Exchange Commission from time to time, including our Form 10-Q that will be filed for the quarter ended October 31, 2009 and our Form 10-K for the fiscal year ended January 31, 2009. These documents are available on the SEC Filings section of the Investor Information section of our website at www.salesforce.com/investor.

Salesforce.com, inc. assumes no obligation and does not intend to update these forward-looking statements, except as required by law.

Copyright (c) 2009 salesforce.com, inc. All rights reserved. Salesforce and the "no software" logo are registered trademarks of salesforce.com, inc., and salesforce.com owns other registered and unregistered trademarks. Other names used herein may be trademarks of their respective owners.

    salesforce.com, inc.
    Condensed Consolidated Statements of Operations
    (in thousands, except per share data)
      (Unaudited)

                                     Three Months Ended   Nine Months Ended
                                          October 31,         October 31,
                                        2009      2008      2009      2008
                                        ----      ----      ----      ----
    Revenues:
      Subscription and support       $306,870  $253,403  $882,078  $718,464
      Professional services and
       other                           23,679    23,084    69,456    68,722
                                       ------    ------    ------    ------
        Total revenues                330,549   276,487   951,534   787,186

    Cost of revenues (1):
      Subscription and support         40,745    32,424   116,744    91,802
      Professional services and
       other                           24,825    23,924    73,122    69,935
                                       ------    ------    ------    ------
        Total cost of revenues         65,570    56,348   189,866   161,737

    Gross profit                      264,979   220,139   761,668   625,449

    Operating expenses (1):
      Research and development         32,763    26,270    95,450    70,070
      Marketing and sales             152,166   136,452   436,647   389,930
      General and administrative       49,909    41,284   139,818   117,797
                                       ------    ------   -------   -------
        Total operating expenses      234,838   204,006   671,915   577,797

    Income from operations             30,141    16,133    89,753    47,652

    Interest, net                       7,211     3,840    18,987    17,270
    Other income (expense)               (336)      534    (1,037)   (1,069)
                                         ----       ---    ------    ------

    Income before provision for
     income taxes and noncontrolling
     interest                          37,016    20,507   107,703    63,853

    Provision for income taxes        (15,573)   (8,824)  (45,426)  (29,693)
                                      -------    ------   -------   -------

    Consolidated net income            21,443    11,683    62,277    34,160

    Less: Net income attributable
     to noncontrolling interest          (752)   (1,559)   (1,952)   (4,485)
                                         ----    ------    ------    ------

    Net income attributable to
     salesforce.com                   $20,691   $10,124   $60,325   $29,675
                                      =======   =======   =======   =======

    Earnings per share - basic and
     diluted:

    Basic net income per share
     attributable to salesforce.com
     common shareholders                $0.17     $0.08     $0.49     $0.25

    Diluted net income per share
     attributable to salesforce.com
     common shareholders                $0.16     $0.08     $0.48     $0.24

    Shares used in computing basic
     net income per share             124,561   121,635   123,871   120,759

    Shares used in computing
     diluted net income per share     128,596   125,133   126,993   125,173


    (1) Amounts include stock-based
         expenses, as follows:
        Cost of revenues               $2,995    $2,817    $9,322    $8,149
        Research and development        2,707     2,494     8,741     6,852
        Marketing and sales             9,055     9,235    28,314    26,105
        General and administrative      5,650     4,730    16,570    15,119



    salesforce.com, inc.
    Condensed Consolidated Statements of Operations
      As a percentage of total revenues:
      (Unaudited)

                                                    Three Months Nine Months
                                                        Ended       Ended
                                                     October 31, October 31,
                                                     2009  2008  2009  2008
                                                     ----  ----  ----  ----
    Revenues:
      Subscription and support                         93%   92%   93%   91%
      Professional services and other                   7     8     7     9
                                                      ---   ---   ---   ---
        Total revenues                                100   100   100   100

    Cost of revenues:
      Subscription and support                         12    12    12    12
      Professional services and other                   8     8     8     9
                                                      ---   ---   ---   ---
        Total cost of revenues                         20    20    20    21

    Gross profit                                       80    80    80    79

    Operating expenses:
      Research and development                         10    10    10     9
      Marketing and sales                              46    49    46    49
      General and administrative                       15    15    15    15
                                                      ---   ---   ---   ---
        Total operating expenses                       71    74    71    73

    Income from operations                              9     6     9     6

    Interest, net                                       2     1     2     2
    Other income (expense)                              0     0     0     0
                                                      ---   ---   ---   ---

    Income before provision for income taxes and
     noncontrolling interest                           11     7    11     8

    Provision for income taxes                         (5)   (3)   (5)   (4)
                                                      ---   ---   ---   ---

    Consolidated net income                             6     4     6     4

    Less: Net income attributable to noncontrolling
     interest                                           0     0     0     0
                                                      ---   ---   ---   ---

    Net income attributable to salesforce.com           6%    4%    6%    4%
                                                      ===   ===   ===   ===



    Stock-based expenses as a percentage of total
     revenues, as follows:
        Cost of revenues                                1%    1%    1%    1%
        Research and development                        1     1     1     1
        Marketing and sales                             3     3     3     3
        General and administrative                      1     2     2     2



    salesforce.com, inc.
    Condensed Consolidated Balance Sheets
    (in thousands)

                                                   October 31,  January 31,
                                                        2009         2009
                                                        ----         ----
                                                   (unaudited)
    Assets
    Current assets:
      Cash and cash equivalents                      $242,888     $483,834
      Short-term marketable securities                202,446      213,769
      Accounts receivable, net                        191,297      266,555
      Deferred commissions                             37,065       39,384
      Deferred income taxes                            26,992       31,900
      Prepaid expenses and other current assets        62,227       33,115
                                                       ------       ------

    Total current assets                              762,915    1,068,557

    Marketable securities, noncurrent                 624,758      184,962
    Fixed assets, net                                  95,598       77,027
    Deferred commissions, noncurrent                   17,077       17,699
    Deferred income taxes, noncurrent                  30,695       26,589
    Capitalized software, net                          32,780       29,989
    Goodwill                                           45,402       44,872
    Other assets, net                                  33,976       30,127
                                                       ------       ------

    Total assets                                   $1,643,201   $1,479,822
                                                   ==========   ==========

    Liabilities and stockholders' equity
    Current liabilities:
      Accounts payable                                $15,617      $16,379
      Accrued expenses and other current liabilities  174,309      163,205
      Income taxes payable                              3,050        3,619
      Deferred revenue                                533,502      583,763
                                                      -------      -------

    Total current liabilities                         726,478      766,966

    Income taxes payable, noncurrent                   19,298       12,490
    Long-term lease liabilities and other              14,952        7,616
    Deferred revenue, noncurrent                       11,933       10,263
                                                       ------       ------
    Total liabilities                                 772,661      797,335

    salesforce.com stockholders' equity:
      Common stock                                        125          123
      Additional paid-in capital                      775,838      648,724
      Accumulated other comprehensive loss             (3,239)      (2,905)
      Retained earnings                                86,167       25,842
                                                       ------       ------

        Total stockholders' equity  controlling
         interest                                     858,891      671,784

    Total stockholders' equity noncontrolling
     interest                                          11,649       10,703
                                                       ------       ------

    Total stockholders' equity                        870,540      682,487
                                                      -------      -------

    Total liabilities and stockholders' equity     $1,643,201   $1,479,822
                                                   ==========   ==========



    salesforce.com, inc.
    Condensed Consolidated Statements of Cash Flows
    (in thousands)
      (Unaudited)
                                      Three Months Ended   Nine Months Ended
                                           October 31,         October 31,
                                         2009      2008      2009      2008
                                         ----      ----      ----      ----
    Operating activities:
    Consolidated net income            $21,443   $11,683   $62,277   $34,160
    Adjustments to reconcile net
     income to net cash provided by
     operating activities:
      Depreciation and amortization     13,601     7,910    37,890    24,938
      Amortization of deferred
       commissions                      15,698    14,784    45,959    43,414
      Expenses related to stock-
       based awards                     20,407    19,276    62,947    56,225
      Excess tax benefits from
       employee stock plans             (7,401)  (17,706)  (32,536)  (42,247)
      Loss on securities                     -     2,052         -     2,052
      Changes in assets and liabilities:
        Accounts receivable, net       (22,515)   (9,002)   75,355    64,077
        Deferred commissions           (18,013)  (13,682)  (43,018)  (40,564)
        Prepaid expenses and other
         current assets                (12,892)   (6,313)  (14,711)  (12,406)
        Other assets                      (506)   (2,943)     (624)     (429)
        Accounts payable                 2,228     6,621      (762)   12,951
        Accrued expenses and other
         current liabilities            27,045    14,733    35,165    23,497
        Deferred revenue                (3,575)  (10,292)  (48,591)  (11,640)
                                        ------   -------   -------   -------

        Net cash provided by
         operating activities           35,520    17,121   179,351   154,028
                                        ------    ------   -------   -------

    Investing activities:
    Purchase of subsidiary stock             -   (16,693)        -   (16,693)
    Business combinations, net of
     cash acquired                      (4,500)  (27,344)   (4,500)  (27,344)
    Purchase of marketable securities (218,056) (123,476) (980,519) (323,415)
    Sales of marketable securities     121,413    26,656   438,679    84,187
    Maturities of marketable
     securities                         55,400    66,557   119,566   200,387
    Capital expenditures               (14,089)  (11,614)  (46,845)  (48,827)
                                       -------   -------   -------   -------

        Net cash used in investing
         activities                    (59,832)  (85,914) (473,619) (131,705)
                                       -------   -------  --------  --------

    Financing activities:
    Proceeds from the exercise of
     stock options                      18,559     6,595    32,866    40,605
    Excess tax benefits from
     employee stock plans                7,401    17,706    32,536    42,247
    Principal payments on capital
     lease obligations                  (2,398)     (286)   (5,904)     (291)
                                        ------      ----    ------      ----

        Net cash provided by
         financing activities           23,562    24,015    59,498    82,561
                                        ------    ------    ------    ------

    Effect of exchange rate changes     (2,531)       49    (6,176)   (1,665)
                                        ------       ---    ------    ------

    Net (decrease) increase in cash and
    cash equivalents                    (3,281)  (44,729) (240,946)  103,219

    Cash and cash equivalents,
     beginning of period               246,169   427,043   483,834   279,095
                                       -------   -------   -------   -------

    Cash and cash equivalents, end
     of period                        $242,888  $382,314  $242,888  $382,314
                                      ========  ========  ========  ========



    salesforce.com, inc.
    Additional Metrics
      (Unaudited)

                       Oct 31,    Jul 31, April 30,  Jan 31,  Oct 31,  Jul 31,
                        2009       2009      2009     2009     2008     2008
                        ----       ----      ----     ----     ----     ----
    Full Time
     Equivalent
     Headcount          3,814      3,653     3,607    3,566    3,318    3,046

    Financial data
     (in thousands):
      Cash, cash
       equivalents
       and marketable
       securities  $1,070,092 $1,030,406  $983,824 $882,565 $804,606 $823,417
      Deferred
       revenue,
       current and
       noncurrent    $545,435   $549,010  $549,373 $594,026 $469,534 $479,546



                                     Three Months Ended   Nine Months Ended
                                          October 31,         October 31,
                                        2009      2008      2009      2008
                                        ----      ----      ----      ----
    Revenues by geography
     (in thousands):
      Americas                       $232,802  $200,143  $679,460  $567,076
      Europe                           60,761    48,076   168,355   142,597
      Asia Pacific                     36,986    28,268   103,719    77,513
                                       ------    ------   -------    ------

                                     $330,549  $276,487  $951,534  $787,186
                                     ========  ========  ========  ========

    As a percentage of total revenues:

    Revenues by geography:
      Americas                             70%       72%       71%       72%
      Europe                               18        17        18        18
      Asia Pacific                         12        11        11        10
                                          ---       ---       ---       ---

                                          100%      100%      100%      100%
                                          ===       ===       ===       ===


SOURCE salesforce.com



RELATED LINKS
http://www.salesforce.com

More by this Source


Custom Packages

Browse our custom packages or build your own to meet your unique communications needs.

Start today.

 

PR Newswire Membership

Fill out a PR Newswire membership form or contact us at (888) 776-0942.

Learn about PR Newswire services

Request more information about PR Newswire products and services or call us at (888) 776-0942.