First Ever Software-as-a-Service Company to Exceed $950M Annual Revenue Run
Rate
- Record Revenue of $248 Million, up 52% Year-Over-Year
- Record Operating Cash Flow of $84 Million, up 128% Year-Over-Year
- GAAP EPS of $0.08, up from $0.01 Year-Over-Year
- Net Paying Customers Rise 2,600 to a record 43,600
- Total Cash and Marketable Securities Increases $303 Million
Year-Over-Year to $751 Million
- Company Raises FY09 Revenue & GAAP EPS Guidance to $1.060 - $1.065
Billion and $0.33 - $0.34 Respectively
SAN FRANCISCO, May 21 /PRNewswire-FirstCall/ -- Salesforce.com
(NYSE: CRM), the market and technology leader in Software-as-a-Service (SaaS)
and Platform-as-a-Service (PaaS), today announced results for its fiscal first
quarter ended April 30, 2008.
(Logo: http://www.newscom.com/cgi-bin/prnh/20050216/SFW105LOGO)
"First quarter revenues were up 52% year-over-year, and well above our
guidance," said Marc Benioff, Chairman and CEO. "And our growing
profitability contributed to GAAP EPS of eight cents per share, up from one
cent a year ago, and record operating cash of $84M, an increase of 128% from
the prior year. Salesforce.com has now generated more than a quarter billion
dollars of operating cash in the last 12 months alone."
Salesforce.com delivered the following results for its first quarter
fiscal year 2009:
Revenue: Total Q1 revenue was $247.6 million, an increase of 52% on a
year-over-year basis and an increase of 14% on a quarter-over-quarter
basis. Subscription and support revenues were $225.3 million, an
increase of 53% on a year-over-year basis and an increase of 15% on a
quarter-over-quarter basis. Professional services and other revenues were
$22.3 million, an increase of 51% on a year-over-year basis and an
increase of 9% on a quarter-over-quarter basis.
Earnings per Share: Q1 GAAP diluted earnings per share were approximately
$0.08, including approximately $18 million in stock based compensation and
approximately $1.3 million in amortization of purchased intangibles
related to previously announced acquisitions. For the basis of Q1 GAAP
EPS calculations, there was an average of approximately 124 million
diluted shares outstanding during the quarter.
Customers Additions: Net paying customers rose approximately 2,600 during
the quarter to approximately 43,600. Compared with the year ago quarter,
net paying customers have grown by approximately 11,300.
Cash: Cash from operations for the fiscal first quarter was approximately
$84 million, up 128% year-over-year, up 4% from Q4, and a company record
for the 3rd consecutive quarter. Total cash, cash equivalents and
marketable securities finished the quarter at approximately $751 million,
an increase of approximately $81 million from Q4 and up approximately
$303 million from the year prior.
Deferred Revenue: Deferred revenue on the balance sheet as of April 30,
2008 was approximately $470 million, an increase of 59% on a
year-over-year basis and a decline of 2% on a quarter-over-quarter basis.
As of May 21, 2008, salesforce.com is initiating guidance for its second
quarter, fiscal year 2009. In addition, for its full fiscal year 2009 the
company is raising its revenue and EPS guidance.
Q2 FY09: Revenue for the company's second fiscal quarter is projected to
be in the range of approximately $258 million to approximately $259
million. GAAP diluted EPS is expected to be in the range of approximately
$0.07 to $0.08. This estimate includes the effects of stock based
compensation and the amortization of purchased intangibles. For the
second fiscal quarter, stock based compensation expense is expected to be
approximately $19 million, and the expense associated with amortization of
purchased intangibles is now expected to be approximately $1.3 million.
For purposes of the Q2 GAAP EPS calculation, the company is expecting an
average diluted shares count of approximately 125 million shares, and a
GAAP tax rate of 48%.
Full Year FY09: The company today is raising the full year revenue
guidance it provided on February 27, 2008, with revenue now expected to be
approximately $1.060 billion to approximately $1.065 billion. The company
is also raising its earnings outlook for the full year, expecting GAAP
diluted EPS to be in the range of approximately $0.33 to $0.34. GAAP EPS
estimates include the effects of stock based compensation and the
amortization of purchased intangibles. For the full fiscal year 2009,
stock based compensation expense is expected to be approximately
$83 million, and the expense associated with the amortization of purchased
intangibles is currently expected to be approximately $5.3 million. For
purposes of the full fiscal year 2009 GAAP EPS calculation, the company is
expecting an average diluted shares count of approximately 125 million
shares, and a GAAP tax rate of 48%.
Quarterly Conference Call
Salesforce.com will host a conference call to discuss its first quarter
fiscal 2009 results today at 2:00 p.m. Pacific Time. A live audio webcast of
the conference call, together with detailed financial information, can be
accessed through the company's Investor Relations Web site at
http://www.salesforce.com/investor. In addition, an archive of the webcast can
be accessed through the same link. Participants who choose to call in to the
conference call can do so by dialing domestically 866-901-SFDC or 866-901-7332
and internationally 706-902-1764. A replay will be available at
(800) 642-1687 or (706) 645-9291, passcode 46678383, until midnight Eastern
Time June 13, 2008.
About salesforce.com
Salesforce.com is the market and technology leader in
Software-as-a-Service (SaaS) and Platform-as-a-Service (PaaS). The company's
portfolio of SaaS applications, including its award-winning CRM, available at
http://www.salesforce.com/products/, has revolutionized the ways that
customers manage and share business information over the Internet. The
company's Force.com PaaS enables customers, developers and partners to build
powerful on-demand applications that deliver the benefits of multi-tenancy
across the enterprise. Applications built on the Force.com platform, available
at http://www.force.com/, can be easily shared, exchanged and installed with a
few simple clicks via salesforce.com's AppExchange marketplace available at
http://www.salesforce.com/appexchange/.
As of April 30, 2008, salesforce.com manages customer information for
approximately 43,600 customers including ABN AMRO, Dow Jones Newswires, Japan
Post, Kaiser Permanente, KONE, Sprint Nextel, and SunTrust Banks. Any
unreleased services or features referenced in this or other press releases or
public statements are not currently available and may not be delivered on time
or at all. Customers who purchase salesforce.com applications should make
their purchase decisions based upon features that are currently available.
Salesforce.com has headquarters in San Francisco, with offices in Europe and
Asia, and trades on the New York Stock Exchange under the ticker symbol "CRM".
For more information please visit http://www.salesforce.com, or call
1-800-NO-SOFTWARE.
"Safe harbor" statement under the Private Securities Litigation Reform Act
of 1995: This press release contains forward-looking statements about
expected revenue and GAAP earnings per share for the second fiscal quarter of
2009 and the full fiscal year 2009, and our expected tax rate, stock based
compensation expense, amortization rate, and shares outstanding, the
achievement of which involve risks, uncertainties and assumptions. If any such
risks or uncertainties materialize or if any of the assumptions prove
incorrect, our results could differ materially from the results expressed or
implied by the forward-looking statements we make.
The risks and uncertainties referred to above include -- but are not
limited to -- risks associated with possible fluctuations in our financial and
operating results, rate of growth and anticipated revenue run rate; errors,
interruptions or delays in our service or our Web hosting; breaches of our
security measures; the impact of any future acquisitions, the nature of our
business model; our ability to continue to release, and gain customer
acceptance of, new and improved versions of our service; successful customer
deployment and utilization of our existing and future services; competition;
various financial aspects of our subscription model; the emerging market in
which we operate; our ability to hire, retain and motivate our employees and
manage our growth; changes in our customer base; technological developments;
unanticipated changes in our effective tax rate; and fluctuations in the
number of shares we have outstanding, the price of such shares, foreign
currency exchange rates and interest rates.
Further information on these and other factors that could affect our
financial results is included in the reports on Forms 10-K, 10-Q and 8-K and
in other filings we make with the Securities and Exchange Commission from time
to time, including our Form 10-Q that will be filed for the quarter ended
April 30, 2008 and our Form 10-K for the fiscal year ended January 31, 2008.
These documents are available on the SEC Filings section of the Investor
Information section of our website at http://www.salesforce.com/investor.
Salesforce.com, inc. assumes no obligation and does not intend to update
these forward-looking statements, except as required by law.
Copyright (c) 2008 salesforce.com, inc. All rights reserved. Salesforce
and the "no software" logo are registered trademarks of salesforce.com, inc.,
and salesforce.com owns other registered and unregistered trademarks. Other
names used herein may be trademarks of their respective owners.
salesforce.com, inc.
Condensed Consolidated Statements of Operations
(in thousands, except per share data)
(Unaudited)
Three Months Ended April 30,
2008 2007
Revenues:
Subscription and support $225,341 $147,690
Professional services and other 22,281 14,722
Total revenues 247,622 162,412
Cost of revenues (1):
Subscription and support 28,710 20,184
Professional services and other 22,588 18,983
Total cost of revenues 51,298 39,167
Gross profit 196,324 123,245
Operating expenses (1):
Research and development 19,767 14,121
Marketing and sales 122,704 83,925
General and administrative 38,432 25,085
Total operating expenses 180,903 123,131
Income from operations 15,421 114
Interest, net 6,722 5,007
Other income (expense) (763) 169
Income before provision for income
taxes and minority interest 21,380 5,290
Provision for income taxes (10,311) (3,842)
Income before minority interest 11,069 1,448
Minority interest in consolidated
joint venture (1,514) (718)
Net income $9,555 $730
Basic net income per share $0.08 $0.01
Diluted net income per share $0.08 $0.01
Shares used in computing basic net
income per share 119,778 114,987
Shares used in computing diluted net
income per share 124,414 120,635
(1) Amounts include stock-based
expenses, as follows:
Cost of revenues $2,675 $1,774
Research and development 2,099 1,277
Marketing and sales 8,121 5,619
General and administrative 5,170 3,342
Total stock-based
expenses $18,065 $12,012
salesforce.com, inc.
Condensed Consolidated Statements of Operations
As a percentage of total revenues:
(Unaudited)
Three Months Ended April 30,
2008 2007
Revenues:
Subscription and support 91% 91%
Professional services and other 9 9
Total revenues 100 100
Cost of revenues:
Subscription and support 12 12
Professional services and other 9 12
Total cost of revenues 21 24
Gross profit 79 76
Operating expenses:
Research and development 8 9
Marketing and sales 50 52
General and administrative 15 15
Total operating expenses 73 76
Income from operations 6 0
Interest, net 3 3
Other income (expense) 0 0
Income before provision for income
taxes and minority interest 9 3
Provision for income taxes (4) (2)
Income before minority interest 5 1
Minority interest in consolidated
joint venture (1) (1)
Net income 4% 0%
Stock-based expenses as a percentage
of total revenues, as follows:
Cost of revenues 1% 1%
Research and development 1 1
Marketing and sales 3 3
General and administrative 2 2
Total stock-based
expenses 7% 7%
salesforce.com, inc.
Condensed Consolidated Balance Sheets
(in thousands)
April 30, January 31,
2008 2008
(unaudited)
Assets
Current assets:
Cash and cash equivalents $378,548 $279,095
Short-term marketable securities 116,535 171,748
Accounts receivable, net 143,909 220,061
Deferred commissions 34,937 35,679
Deferred income taxes 7,310 7,173
Prepaid expenses and other
current assets 32,170 27,055
Total current assets 713,409 740,811
Marketable securities, noncurrent 255,550 218,957
Fixed assets, net 56,816 41,380
Deferred commissions, noncurrent 15,104 16,435
Deferred income taxes, noncurrent 32,301 26,512
Capitalized software, net 22,969 23,061
Goodwill 8,556 8,556
Other assets 14,888 13,881
Total assets $1,119,593 $1,089,593
Liabilities and stockholders'
equity
Current liabilities:
Accounts payable $19,315 $7,478
Accrued expenses and other
current liabilities 102,596 125,996
Income taxes payable 1,155 3,622
Deferred revenue 457,913 468,821
Total current liabilities 580,979 605,917
Income taxes payable, noncurrent 9,511 8,465
Long-term lease abandonment
liability and other 3,195 2,136
Deferred revenue, noncurrent 12,384 12,073
Minority interest 10,457 8,943
Total liabilities 616,526 637,534
Stockholders' equity:
Common stock 120 119
Additional paid-in capital 514,621 471,802
Accumulated other comprehensive
loss (3,643) (2,276)
Accumulated deficit (8,031) (17,586)
Total stockholders' equity 503,067 452,059
Total liabilities and stockholders'
equity $1,119,593 $1,089,593
salesforce.com, inc.
Condensed Consolidated Statements of Cash Flows
(in thousands)
(Unaudited)
Three Months Ended April 30,
2008 2007
Operating activities:
Net income $9,555 $730
Adjustments to reconcile net income
to net cash provided by operating
activities:
Minority interest 1,514 718
Depreciation and amortization 8,158 4,848
Amortization of deferred
commissions 14,723 9,039
Expenses related to stock-based
awards 18,065 12,012
Excess tax benefits from employee
stock plans (12,698) (6,286)
Changes in assets and liabilities 44,515 15,769
Net cash provided by operating
activities 83,832 36,830
Investing activities:
Changes in marketable securities 16,540 (34,212)
Capital expenditures (24,177) (15,957)
Net cash used in investing
activities (7,637) (50,169)
Financing activities:
Proceeds from the exercise of stock
options and warrants 11,485 8,300
Excess tax benefits from employee
stock plans 12,698 6,286
Principal payments on capital lease
obligations (5) (157)
Net cash provided by financing
activities 24,178 14,429
Effect of exchange rate changes (920) (206)
Net increase in cash and
cash equivalents 99,453 884
Cash and cash equivalents, beginning
of period 279,095 86,608
Cash and cash equivalents, end of
period $378,548 $87,492
salesforce.com, inc.
Additional Metrics
(Unaudited)
April 30, Jan 31, Oct 31, Jul 31,
2008 2008 2007 2007
Full Time Equivalent Headcount 2,864 2,606 2,461 2,302
Financial data (in thousands):
Cash, cash equivalents
and marketable securities $750,633 $669,800 $571,003 $497,191
Deferred revenue, current
and non-current $470,297 $480,894 $340,808 $321,852
Apr 30, Jan 31, Oct 31,
2007 2007 2006
2,243 2,070 1,807
$448,071 $412,512 $371,278
$295,672 $284,063 $219,431
Three Months Ended April 30,
2008 2007
Revenues by geography
(in thousands):
Americas $178,371 $124,452
Europe 45,164 25,574
Asia Pacific 24,087 12,386
$247,622 $162,412
As a percentage of total
revenues:
Revenues by geography:
Americas 72% 77%
Europe 18 16
Asia Pacific 10 7
100% 100%
SOURCE salesforce.com, inc.
05/21/2008
/CONTACT: David Havlek, Investor Relations, +1-415-536-2171,
dhavlek@salesforce.com, or Jane Hynes, Public Relations, +1-415-901-5079,
jhynes@salesforce.com, both of salesforce.com
Web site: http://www.salesforce.com
(CRM)
