Salesforce.com didn't have a problem surpassing analyst expectations with its second quarter earnings report, published after the bell on Thursday.
The CRM giant reported a net income of $76.6 million, or 12 cents per share (statement). Non-GAAP earnings were nine cents per share on a revenue of $957 million, up 31 percent year-over-year.
Wall Street was expecting Salesforce to report second quarter earnings of seven cents a share on revenue of $939.2 million.
After the report hit the wires, Salesforce earnings were up by roughly seven percent in after-hours trading.
The San Francisco-headquartered company acknowledged that it got a big revenue boost this quarter with thanks to its. That deal closed in July.
To further break down revenue figures, subscription and support revenues accounted for $903 million, up 31 percent annually. Professional services and other revenues totaled $54 million, up 23 percent year-over-year.
In prepared remarks, CEO Marc Benioff reflected briefly on the busy quarter,with its number one frenemy Oracle:
Salesforce.com continues to be the fastest growing software company of its size with year-over-year growth of more than 30% in revenue, deferred revenue, and operating cash flow. I'm delighted to announce that just four years after delivering our first $1 billion revenue year, we are now poised to deliver our first $1 billion revenue quarter in the third quarter of fiscal 2014.
For the third quarter, Wall Street expects Salesforce to return with revenue of at least $1.04 billion and non-GAAP earnings of seven cents per share.
Salesforce expects Q3 revenue to fall within the range of $1.050 billion to $1.055 billion, which would be between 33 and 34 percent higher on an annual basis. Q3 earnings per share are expected to drop between eight and nine cents.
For the full fiscal year 2014, Salesforce said it is raising its outlook, now providing a revenue guidance range of $4.000 billion to $4.025 billion, up between 31 and 32 percent year-over-year, with non-GAAP earnings of 32 to 34 cents per share.
UPDATE: During the conference call on Thursday, Benioff projected a big milestone to be met by the third quarter.
Recalling that Salesforce’s first billion-dollar revenue year was four years ago, Benioff predicted that the company will finally deliver $1 billion in quarterly revenue in the next three months.
He boasted that "no other enterprise software company of our size" is growing at the same rate.
Benioff also responded briefly to questions about the Oracle-Salesforce deal.
Following up on a question about further integration with SAP, Benioff remarked that “companies like Oracle and SAP who have not been able to bring their product lines” to cloud, social and mobile can benefit from alliances with Salesforce.com with its “brand services and innovation.”
Salesforce also has another notable event on the horizon: Dreamforce. Following the aforementioned acquisition of ExactTarget and its integration within Salesforce's Marketing Cloud, expect that unit to take center stage at some point.
Additionally, Benioff offered an ever-so-tiny sneak peek at what to expect at the cloud company's flagship event, which will include keynotes by Facebook chief operating officer Sheryl Sandberg and Yahoo chief executive officer Marissa Mayer.
But it's not all sunshine and rainbows for the business software provider.
Chief financial officer Graham Smith explained that that the ExactTarget acquisition brought on approximately 1,900 more employees.
Salesforce added more than 2,200 new employees during the second quarter, bringing the total headcount to more than 12,500.
However, Smith continued that combining ExactTarget with our existing Marketing Cloud is providing greater levels of synergies."
But the real bottom line, he admitted, is that Salesforce is reducing its total headcount by approximately 200 people. Smith said this reduction should reduce fiscal 2014 non-GAAP EPS by about one cent.
Chart via Salesforce Investor Relations