June 4, 2019 / 8:13 PM / 8 months ago

Salesforce forecasts full-year results above expectations, shares rise

(Reuters) - Salesforce.com Inc beat analysts’ estimates for quarterly revenue and profit on Tuesday and forecast full-year results above expectations, as customers looking to rein in costs boosted demand for its Sales Cloud product.

FILE PHOTO: The company logo for Salesforce.com is displayed on the Salesforce Tower in New York City, U.S., March 7, 2019. REUTERS/Brendan McDermid

The San Francisco-based company’s shares rose nearly 3% in trading after the bell.

Revenue from the company’s flagship product, Sales Cloud, rose 11% to $1.1 billion in the first quarter.

The company raised its full-year 2020 adjusted profit forecast to be in the range of $2.88 to $2.90 per share and revenue between $16.10 billion and $16.25 billion. Analysts on average were expecting a profit of $2.66 per share on revenue of $16.12 billion.

Salesforce is in the early stages of international expansion, offering it potential for growth, New England Investment & Retirement Group analyst Brian Pirri said.

Salesforce and other cloud-based service providers are benefiting from a growing trend among companies to shift their operations onto lower cost cloud-based services that also offer more scalability.

Last week, smaller rival Workday Inc reported better-than-expected quarterly profit and revenue, as it enrolled more companies for its cloud-based financial and human resources software.

Salesforce’s net income rose to $392 million, or 49 cents per share, in the quarter ended April 30, from $344 million, or 46 cents per share, a year earlier.

The company’s total revenue rose 24% to $3.74 billion.

Excluding items, the company earned 93 cents per share, while analysts on average had expected 61 cents per share.

Reporting by Sayanti Chakraborty in Bengaluru; Editing by Maju Samuel and James Emmanuel

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