salesforce.com, inc. (NYSE:CRM) has reported yet another strong quarter and beat WallStreet estimates, for its 4Q2015. Additionally, the company also updated its revenue guidance, helping the stock rally. Marc Benioff, the CEO of CRM, stated that the defining factor for his company is selling directly to CEOs. He pointed towards Oracle and SAP and stated that his company is expanding its market share, because the two major competitors do not conduct sales in such a way.
Oracle and SAP are both legacy companies and tend to do things in a conventional way. This means that they conduct sales through the CIO of the company and they sometimes have to offer free trials as well. However, SalesForce believes that CEOs are assuming more active roles in such decisions and they want to be the ones to decide which software to buy. This tactic tends to give SalesForce two major advantages. They increase their chances of conducting a sale, by reaching out to the highest authority and they are able to convince the CEOs to spend more than their IT budget.
CRM reported earnings of $1.81 billion during the 4Q2015 and had over $11 billion in deferred revenues. This helped the company report an EPS of $0.01. Added to this, the quarter saw two 9 figure deals and over 600 7 figure deals, conducted by SalesForce. These deals would add to the company’s future revenue. SalesForce also identified that customers were increasing sales for the company, despite an economic slowdown.
Furthermore, CRM also updated its full year EPS forecast to $1.01 per share, with revenues of about $8.1 billion. The most important aspect in the report was the sale in January. Other IT companies had started to see a decline in sales, during the same time CRM reported a 12.3% rise in sales.
salesforce.com, inc. (NYSE:CRM) lost 0.64% of its share value during the February 24 trading session, after having a trade volume of 11.91 million, to close at $62.5.