Salesforce stock jumps as it raises profit forecast, company will be more ‘measured’ in hiring

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Marc Benioff, co-CEO of Inc., speaks on a panel session at the World Economic Forum in Davos, Switzerland, on Tuesday, May 24, 2022.
Hollie Adams | Bloomberg | Getty Images

Salesforce shares rose 5% in extended trading on Tuesday after the enterprise-software maker reported fiscal first-quarter results that surpassed analysts’ expectations and lifted its full-year earnings guidance.

Here’s how the company did:

Earnings: 98 cents per share, adjusted, vs. 94 cents per share as expected by analysts, according to Refinitiv.Revenue: $7.41 billion, vs. $7.38 billion as expected by analysts, according to Refinitiv.

Salesforce’s revenue rose 24% year over year in the quarter, which ended April 30, according to a statement. Net income fell 94% to $28 million.

Salesforce said revenue from its Service Cloud for handling customer-service inquiries generated $1.76 billion in revenue, up almost 17%. Revenue from the core Sales Cloud product for managing business opportunities contributed $1.63 billion, up about 18%.

In the quarter Salesforce said its Sales Cloud, Service Cloud and Marketing Cloud integrations for Slack were launching in beta. Salesforce acquired Slack for $27.1 billion in July. The company also announced the launch of Safety Cloud for organizing in-person events during the quarter, and its legal name changed to Salesforce Inc. from Inc. Salesforce was founded in 1999, in the midst of the dot-com craze.

In early March, after Russia invaded Ukraine, Salesforce said it began to end relationships with customers it has accumulated in Russia through resellers and other channels.

With respect to guidance, Salesforce said it sees fiscal second-quarter earnings of $1.01 to $1.02 per share on an adjusted basis and revenue from $7.69 billion to $7.70 billion. Analysts polled by Refinitiv had expected $1.14 in adjusted earnings per share on $7.77 billion in revenue.

Salesforce lowered its revenue guidance for the full 2023 fiscal year while boosting its profit view. It now sees $4.74 to $4.76 per share in adjusted earnings and $31.7 billion to $31.8 billion in revenue. Analysts polled by Refinitiv had expected $4.65 in adjusted earnings per share and $32.06 billion in revenue.

Notwithstanding the after-hours move, Salesforce stock has moved about 36% lower since the start of the year, while the broader S&P 500 index has declined 13% over the same period.

Executives will discuss the results with analysts on a conference call starting at 5 p.m. ET.

This is breaking news. Please check back here for updates.

WATCH: Salesforce was born in the 2001 recession, says chairman and co-CEO Marc Benioff

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