UPDATE 2-Salesforce.com raises outlook, shares up
(Adds company comment, Reuters Estimates, byline)
By Jim Finkle
BOSTON, Feb 27 (Reuters) - Salesforce.com Inc (CRM.N) raised its full-year revenue forecast on Wednesday as it reported quarterly profit ahead of Wall Street estimates, saying it is doing well even in the weakening U.S. market.
Shares of the company, a pioneer in the Web-based software market, rose 8.3 percent on the news, released after the markets closed.
Salesforce raised its fiscal 2009 revenue forecast to between $1.030 billion and $1.035 billion, from its November forecast range of $1.0 billion to $1.02 billion.
It also said it expected full-year net income to be between 32 cents and 33 cents per share. Analysts on average were looking for earnings per share of 32 cents on revenue of $1.027 billion, according to Reuters Estimates.
Salesforce spokesman Bruce Francis said the company was performing well across the globe. He attributed the performance to rising interest in its approach of selling software as a service delivered over the Internet.
"There is tremendous momentum behind the products and services we are offering," he said.
Analysts have said Salesforce.com and other software makers that specialize in the software-as-a-service model might outperform the rest of the industry in a recession because the upfront costs of buying their products are relatively low.
Established software makers, including Oracle Corp (ORCL.O) and SAP AG (SAPG.DE), are experimenting with software as a service, but they sell the bulk of their products the way they always have: companies pay for the software in advance, install it on computers and pay maintenance fees.
Salesforce reported fourth-quarter net income of $7.38 million, or 6 cents per share, up from $516,000, or nil per share, in the year-ago period. That beat the average analyst forecast for earnings of 4 cents per share, according to Reuters Estimates.
Revenue rose 50 percent to $217 million during the quarter, compared to Wall Street expectations of $209 million revenue.
Salesforce also said it expects to report fiscal first quarter net income of 6 cents to 7 cents per share on revenue of $233 million to $235 million.
Analysts were looking for first quarter earnings per share of 6 cents and revenue of $228 million, according to Reuters Estimates.
Salesforce shares were up 8.3 percent at $57.0 in after-hours trading, compared to their $52.62 close on the New York Stock Exchange. (Reporting by Jim Finkle; editing by Richard Chang, Leslie Gevirtz)
