Salesforce.com squeezes $1B from the cloud

The company boasts of becoming the first company to make $1 billion in revenue in a year from cloud computing--but lowered its forecast.

Salesforce.com CEO Marc Benioff
Salesforce.com CEO Marc Benioff Stephen Shankland/CNET News

Salesforce.com showed Wednesday that cloud computing can produce serious money--but also that it's not immune from the current unpleasant economic climate.

For its fiscal 2009, which ended January 31, the San Francisco-based company reported revenue of $1.08 billion, a 44 percent increase. But for fiscal 2010, it lowered its forecast to a range of $1.3 billion to $1.33 billion.

In November, the company had forecast $1.35 billion to $1.36 billion, and analysts surveyed by Thomson Reuters expect on average $1.325 billion for the year.

"We've slightly lowered the guidance range. There's increasing uncertainty out there," Chief Financial Officer Graham Smith said on the company's conference call.

For the company's fourth quarter, Salesforce.com reported net income of $13.8 million, or 11 cents per share, on revenue of $290 million. That compared with $7.4 million net income and $217 million revenue for the year-earlier quarter, and it was better than the 7 cents per share on $285 million in revenue analysts expected.

In after-hours trading, Salesforce.com's stock rose $1.50, or 5 percent, to $29.60.

Salesforce.com's core service lets customers track and analyze customers activity; its online approach also features alliances with some other high-profile Internet sites, including Amazon Web Services, Google Apps, and Facebook.

Salesforce.com's mascot advocates cloud computing over in-house software.
Salesforce.com's mascot advocates cloud computing over in-house software. Stephen Shankland/CNET News

The company competes chiefly with Oracle's Siebel software for customer relationship management, which typically is run on massive computers a company runs on its own.

Salesforce.com has been branching out, though, offering its Force.com system to let companies build their own custom Web-based applications or third-party programmers offer their own extensions to those customers. And in December, the company launched Force.com Sites to house customer's Web sites.

In the fourth quarter, Salesforce.com's technology overall completed more than 12 billion transactions, the company said. The total of more than 1,500 Force.com Sites received more than 15 million page views in the quarter, and there are 166 applications available in the Force.com AppExchange.

"The numbers for the fourth quarter clearly demonstrate increasing adoption of the force.com platform," Chief Executive Marc Benioff said in the conference call.

About the author

Stephen Shankland has been a reporter at CNET since 1998 and covers browsers, Web development, digital photography and new technology. In the past he has been CNET's beat reporter for Google, Yahoo, Linux, open-source software, servers and supercomputers. He has a soft spot in his heart for standards groups and I/O interfaces.

 

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