Salesforce posts solid Q3 revenue; looks toward $4B annual run rate

Summary:UPDATED: The CRM and cloud computing giant delivered a quarterly revenue of $788 million -- up 35 percent from this time last year.

Aiming to be the first cloud computing company to hit a $4 billion annual run rate, Salesforce.com is on the right track as it beat Wall Street expectations for the third quarter.

The social enterprise giant reported a third quarter net loss of $220 million, or $1.55 per share (statement). Non-GAAP earnings were 33 cents a share on a revenue of $788 million, up 35 percent annually.

Wall Street was expecting Salesforce to report third quarter earnings of 32 cents a share on revenue of $776.5 million.

But Salesforce seems interested in discussing future quarters, as CEO Marc Benioff commented about in prepared remarks:

Salesforce.com is the first enterprise cloud computing company to exceed a $3 billion annual revenue run rate, with outstanding third quarter revenue growth at 35% in dollars and 37% in constant currency. Given the strong customer response to our next generation social and mobile cloud technologies, I'm delighted to announce that we expect to surpass a $4 billion annual revenue run rate during our fiscal year 2014.

During the conference call with investors and analysts on Tuesday afternoon, Benioff maintained a very optimistic front and boasted that as one of the small number of companies in the software industry to ever achieve the $3 billion run rate milestone, it marks a major shift towards mobile and social adoption in the enterprise.

"Salesforce.com is the customer company. No other software company has defined itself this way before," Benioff asserted.

The company's co-founder also cited that Salesforce delivered more than 66 billion transactions during the quarter -- up 65 percent annually -- and that executives are expecting to surpass one billion transactions within a single day "any moment now."

For the outlook, Salesforce is predicting a revenue of $825 million to $830 million at the end of Q4 with non-GAAP earnings between 38 to 40 cents a share.

For the fourth quarter, Wall Street is expecting earnings of 40 cents a share on revenue of $829.9 million.

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For fiscal year 2013 overall, Salesforce has raised its guidance to deliver revenue within the range of $3.041 billion to $3.046 billion -- an increase of 34 percent year-over-year -- with non-GAAP earnings of $1.50 to $1.52 per share.

Looking even farther down the road, Salesforce posted its guidance for the fiscal year 2014, with revenue projected to be in the range of $3.80 billion to $3.85 billion.

Earnings per share, however, won't be revealed until Salesforce reveals its fourth quarter fiscal year 2013 results in February 2013.

By the numbers:

  • Subscription and support revenues: $741 million, up 35 percent annually
  • Professional services and other revenues:$48 million, up 36 percent annually

Chart via Salesforce.com

Topics: Salesforce.com, Enterprise 2.0, Enterprise Software, Social Enterprise, Tech Industry

About

Rachel King is a staff writer for CBS Interactive based in San Francisco, covering business and enterprise technology for ZDNet, CNET and SmartPlanet. She has previously worked for The Business Insider, FastCompany.com, CNN's San Francisco bureau and the U.S. Department of State. Rachel has also written for MainStreet.com, Irish Americ... Full Bio

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