Marc Benioff, co-founder and CEO of Salesforce, speaks at the World Economic Forum in Davos, Switzerland on January 18, 2023.
Stefan Wermuth | Bloomberg | Getty Images
Sales department shares soared 14% in extended trading Wednesday after the cloud software maker beat Wall Street’s earnings estimates and posted a better-than-expected forecast.
Here’s how the company did it:
- income: $1.68 per share, adjusted, versus $1.36 per share, as analysts expected, according to Refinitiv.
- income: $8.38 billion, compared with $7.99 billion expected by analysts, according to Refinitiv.
Salesforce’s revenue rose 14% year over year in the quarter ended Jan. 31, according to the statement. The company reported a loss of $98 million, compared with a loss of $28 million in the year-ago quarter.
Marc Benioff, Salesforce co-founder and CEO, said in January that the company would cut 10% of its workforce, more than 7,000 people, and that the restructuring strategy resulted in $828 million in expenses for the quarter.
Profitability has become a bigger priority for Salesforce, which has come under pressure in recent months from an influx of activist investors, including Third Point, Elliott Management and Starboard Value. The company announced the addition of ValueAct Capital CEO Mason Morfitt to its board of directors. At the end of the quarter, Brett Taylor, who ran Salesforce as co-CEO with Benioff, resigned.
For the fiscal first quarter, the company is calling for adjusted earnings in the range of $1.60 to $1.61 per share and revenue of $8.16 billion to $8.18 billion. Analysts polled by Refinitiv had expected $1.32 in adjusted earnings per share and $8.05 billion in revenue.
Salesforce sees full-year adjusted EPS of $7.12 to $7.14 on revenue of $34.5 billion to $34.7 billion. Analysts polled by Refinitiv had expected $5.84 in adjusted earnings per share and $34.03 billion in revenue.
The company said it is expanding its share buyback program to $20 billion after announcing its first share buyback commitment in August with up to $10 billion set aside.
Shares of Salesforce are up 26% this year, excluding Wednesday’s after-hours trade, outperforming the S&P 500, which has gained 3% over the same period.
Executives will discuss the results with analysts during a conference call beginning at 5:00 p.m. ET.
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