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Investor Alert

May 30, 2020, 12:03 p.m. EDT

Salesforce shares dip 4% on light revenue, earnings guidance

By Jon Swartz


Bloomberg News
Salesforce.com Inc. Chief Executive Marc Benioff took over as sole CEO in February after briefly sharing the title with Keith Block.

Salesforce.com Inc. shares were down 4% in after-hours trading Thursday after the enterprise-content platform reported fiscal first-quarter results that were largely in line with Wall Street estimates but offered guidance that fell short.

Salesforce (NYS:CRM)   reported net income of $99 million, or 11 cents a share, compared with net income of $392 million, or 49 cents a share, in the year-ago quarter. Adjusted earnings were 70 cents a share, down from 93 cents a share a year ago.

Revenue improved 30% to $4.87 billion from $3.74 billion a year ago.

Analysts surveyed by FactSet had expected adjusted earnings of 69 cents a share on sales of $4.85 billion.

What tripped up Salesforce shares in after-hours trading was light guidance as the company — like so many of its corporate peers — attempt to navigate choppy waters caused by the ongoing COVID-19 pandemic.

The company offered current second-quarter revenue guidance of $4.89 billion to $4.93 billion, while FactSet analysts are expecting $5.035 billion. Its guidance of adjusted EPS of 66 cents to 67 cents a share fell shy of FactSet projections of 74 cents a share.

“Our results, amidst this global crisis, demonstrated our ability to execute at speed, innovate at scale and the strength of our business model,” Salesforce Chief Executive Marc Benioff said in a statement announcing the results. Benioff, who co-founded the San Francisco-based cloud-computing giant, regained the title of sole CEO in February after sharing the title briefly with former executive Keith Block.

Later, during a conference call with analysts, Benioff said Salesforce has heard from more companies than ever, including customer AT&T Inc. (NYS:T)   that are accelerating their operations to a “digital-first world.”

On Wednesday, Salesforce announced a partnership with Workday Inc. (NAS:WDAY)  .

Salesforce shares are up 11.5% this year. The broader S&P 500 index (S&P:SPX)   is down 6% in 2020.

Link to MarketWatch's Slice.