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Salesforce.com earnings: First quarter on target, but outlook light

Salesforce.com's first quarter earnings were in line with Wall Street expectations, but the earnings outlook for the current quarter and fiscal year looked light.

Salesforce.com's first quarter earnings were in line with Wall Street expectations, but the earnings outlook for the current quarter looked light.

Salesforce.com on Thursday reported net income of 13 cents a share on revenue of $376.8 million, up 24 percent from a year ago. The company said non-GAAP earnings were 30 cents a share (statement). Wall Street was expecting earnings of 30 cents a share on revenue of $368 million.

As for the outlook, Salesforce.com projected second quarter revenue between $381 million and $383 million. Earnings will be 7 cents a share to 8 cents a share. Non-GAAP earnings will be between 26 cents a share and 27 cents a share and that includes a 3 cents a share hit for the just-closed Jigsaw acquisition. In any case, the guidance range appears to be a bit light. Wall Street was expecting earnings of 31 cents a share on revenue of $375.4 million.

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The company also said that it "anticipates closing two small technology-related asset acquisitions in the second quarter." Those purchases will lower fiscal 2011 GAAP earnings by 3 cents an non-GAAP earnings by 2 cents a share. For 2011, Salesforce is projecting revenue between $1.54 billion and $1.55 billion. GAAP earnings will be between 38 cents a share and 40 cents a share. Non-GAAP earnings will be $1.13 a share to $1.15 a share. Wall Street was expecting annual earnings of $1.28 a share on revenue of $1.53 billion.

By the numbers:

  • Salesforce added 4,800 net new customers and ended the first quarter with 77,300 customers.
  • The company ended the quarter with $1.9 billion in cash and equivalents.
  • Deferred revenue as of April 30 was $665 million, up 21 percent from a year ago.