Salesforce.com satisfies Q1 earnings expectations as M&A rumors flurry
In the wake of fervent speculation in the last few weeks that it could be ripe for acquisition, Salesforce.com was expected to deliver strong first quarter financial results after the bell on Wednesday.
The CRM giant reported a net income of $4.1 million, or a penny per share (statement).
Non-GAAP earnings were 16 cents per share on a revenue of $1.51 billion, up 23 percent year-over-year.
Wall Street was looking for first quarter earnings of 14 cents a share on revenue of $1.5 billion.
Subscription and support revenues went up by 22 percent annually to $1.41 billion, while professional services and other revenues totaled $106 million, up 33 percent year-over-year.
Reiterating the social enterprise purveyor's goal to achieve $10 billion in annual revenue, CEO Marc Benioff touted in prepared remarks that Salesforce "surpassed the $6 billion annual revenue run rate faster than any other enterprise software company."
Benioff added that the San Francisco-based company's current outlook puts it on track to reach a $7 billion revenue run rate this year.
But the Q1 report offered a more specific -- and slightly lower -- forecast at year's end.
For the second quarter, Wall Street is looking for earnings of 17 cents per share with $1.59 billion in revenue.
Salesforce followed up with a Q2 revenue guidance range of $1.59 billion to $1.60 billion, translating to a bump of 21 percent year-over-year, with non-GAAP earnings expected to drop between 17 and 18 cents a pop.
For the year, Salesforce projected full fiscal year 2016 to be approximately $6.52 billion to $6.55 billion, a 21 to 22 percent increase year-over-year, with non-GAAP earnings between 69 and 71 cents per share.
Benioff and company didn't address the recent M&A rumors in the first quarter statement, but the topic will likely be addressed during the quarterly shareholders call on Wednesday evening.