updated: At a time when companies are issuing warnings about missing earnings targets and scaling back expectations, enterprise cloud computing company salesforce.com seems to be bucking the trend.
After the bell, Salesforce.com reported income of $10.1 million, or 8 cents per share, on revenue of $276.5 million for the third quarter, which ended on Oct. 31. (Statement) Analysts had been expecting earnings of 7 cents per share on revenue of $273.6 million. Revenue for the quarter was up 43 percent from the same quarter a year ago.
"In times like these, our value proposition of low start up cost, low risk, and fast results is resonating like never before," company chairman and CEO Marc Benioff said in a statement. "In the third quarter, we continued to add customers at the same record level we did last quarter, at a time when the traditional enterprise software world was retrenching."
In a call with analysts, Benioff said the solid quarter is a result of the businesses seeking low up-front costs, low risks and fast results - more so now in this economic climate than before. The customer base has grown to include small, medium and large businesses across multiple industries. In the quarter, sales were continually on the rise, with September sales surpassing August figures and October surpassing September, he said. At the recent Dreamforce conference in San Francisco, customers said they were ready to "leave behind the costs, risks and complexities of traditional enterprise software," Benioff said.
The quarter saw 4,100 new customers added, bringing the company's total up to 51,800, an increase of 36 percent over the same quarter a year ago. For the fourth quarter, the company said it expects earnings of 6-7 cents per share on revenue of $284 million to $285 million. For its fiscal year 2010, the company projected revenue of $1.35 billion to $1.36 billion. The company said it will update guidance and offer projections for its full year EPS after the close of the fourth quarter in February 2009.
Shares of salesforce were up almost four percent in regular trading, closing at $22.83. Shares shot up more than 10 percent in after-hours trading, surpassing the $25 mark.