Salesforce third-quarter revenue forecast misses, shares fall
- Wall Street rises, buoyed by economic data; Dow sets high
- Twitter (TWTR) 'Takeover Money' Moves On as 'Trump Money' Moves In
- Buy Any Seasonal Market Weakness Ahead of Year End Rally - Oppenheimer (SPY)
- After-Hours Stock Movers 12/05: (TXMD) (COUP) (BOBE) Higher; (SB) (LXRX) (STWD) Lower (more...)
A Salesforce sign is seen during the company's annual Dreamforce event, in San Francisco, California November 18, 2013. REUTERS/Robert Galbraith
Get daily under-the-radar research with StreetInsider.com's Stealth Growth Insider Get your 2-Wk Free Trial here.
By Aishwarya Venugopal and Gayathree Ganesan
(Reuters) - Cloud software maker Salesforce.com Inc (NYSE: CRM) forecast third-quarter revenue below estimates as it saw some softness, primarily in the United States, sending the company's shares down by 7.7 percent in extended trading.
For the third quarter, Salesforce said it expected an adjusted profit of 20-21 cents per share and revenue of $2.11 billion-$2.12 billion.
Analysts on average were expecting an adjusted profit of 24 cents per share on revenue of $2.13 billion, according to Thomson Reuters I/B/E/S.
"We had some softness in parts of the U.S. and look, at the end of the day what I would boil this down to is just a bit of blocking and tackling and we've taken a look at it and made the adjustments," said Keith Block, chief operating officer and president of the company.
Deferred revenue, which primarily consists of billings or payments received in advance from subscription services, rose 26 percent to $3.82 billion in the second quarter. Jefferies analysts had estimated deferred revenue of $3.89 billion.
"The revenue in the quarter isn't the best indicator of how the quarter went, especially for a SaaS (software as a service) company like this one," Wedbush Securities analyst Steve Koenig said.
Billings, a more important metric, was below estimate and consensus, Koenig said.
Revenue from the company's biggest unit, the sales cloud business which involves software that allows companies to forecast sales opportunities, rose 12.5 percent to $754.9 million, for the second quarter.
Salesforce reported net income of $229.6 million, or 33 cents per share, in the second quarter ended July 31, compared with a loss of $852,000, or nil cents per share, a year earlier. Total revenue rose 25 percent to $2.04 billion.
Excluding items, the company earned 24 cents per share. Analysts had expected earnings of 22 cents per share on revenue of $2.02 billion.
(Reporting by Aishwarya Venugopal, Gayathree Ganesan and Supantha Mukherjee in Bengaluru; Editing by Shounak Dasgupta)
Serious News for Serious Traders! Try StreetInsider.com Premium Free!
You May Also Be Interested In
- PPL Corp. (PPL) to Reiterate 2016 Earnings Guidance at Upcoming Analyst/Investor Meetings
- Clashes between Congo tribal militia, government kill 31
- AWS and Salesforce Extend Global Strategic Alliance