Cloud Stocks: Salesforce Can Transform Slack PaaS, But Acquisition Still Pending

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Salesforce (NYSE: CRM) recently announced its fiscal fourth-quarter results that surpassed market expectations. While the company continues to grow through acquisitions and product development, its weak earnings outlook for the current year sent the stock falling 5% in the after-hours session.

Salesforce’s Financials

Salesforce’s revenues for the fourth quarter grew 20% to $5.82 billion, above analyst estimates of $5.68 billion. Adjusted earnings of $1.04 per share was also better than the market’s forecast of $0.75 per share.

By segment, Subscription and support revenues grew 20% to $5.48 billion, Professional services and other revenues grew 18% to $341 million.

Revenues for the year grew 24% to $21.25 billion with Subscription and Support revenues growing 25% to $19.98 billion and Professional services and Other revenues increasing 21% to $1.28 billion. Adjusted earnings was $4.92 per share.

For the first quarter, Salesforce forecast revenues of $5.88-$5.89 billion with an EPS of $0.88-$0.89. The market was looking for revenue of $5.72 billion and an EPS of $0.76. Salesforce expects to end the current fiscal year with revenues of $25.65-$25.75 billion and an EPS of $3.39-$3.41. The market was looking for revenues of $25.42 billion for the year with an EPS of $3.54.

Salesforce’s Vaccination Cloud

Earlier last month, Salesforce also announced the release of Vaccine Cloud, a technology to help government agencies, healthcare organizations, businesses, nonprofits, and educational institutions deploy and manage their vaccine programs more rapidly, safely, and efficiently. Currently, several government and nonprofit agencies worldwide are tasked with providing Covid-19 vaccines to citizens. However, most of these agencies and organizations do not have the technology infrastructure in place to handle the complexity, speed, and scale necessary for vaccine administration. Governments are partnering with private sector companies to manage this mass vaccination effort. Salesforce is helping these agencies manage the technology specifically for vaccine logistics.

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Disclosure: All investors should make their own assessments based on their own research, informed interpretations and risk appetite. This article expresses my own opinions based on my own ...

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