Salesforce Q4 Results: Record results beating analysts' expectations

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Earning - Salesforce.com reported a fiscal fourth-quarter loss of $28 million, after reporting a profit in the same period a year earlier. The company said it had a loss of 3 cents per share. Earnings, adjusted for one-time gains and costs, came to 84 cents per share. The results exceeded Wall Street expectations. The average estimate of 15 analysts surveyed by Zacks Investment Research was for earnings of 73 cents per share.

Revenue - It reported revenue of $7.33, in the quarter which ended on 31 January. The revenue is higher than the street estimate of $7.24 billion. The revenue increased by 26% YoY when it posted $5.82 billion in revenue. In the last quarter, it reported revenue of $6.86 billion.

Operating margin - For the fourth quarter, the company reported an operating margin of (2.4)% and a non-GAAP operating margin of 15%. 

Cash - The cash generated from operation for the fourth quarter was $1.98 billion, a decline of 9% compared to the year-ago period. Total cash, cash equivalents, and marketable securities ended the fourth quarter at $10.54 billion.

Leadership update - Salesforce promoted Bret Taylor to co-CEO alongside Marc Benioff, the company’s billionaire co-founder. He joined Salesforce in 2016 through the acquisition of productivity software start-up Quip and quickly rose up the ranks to become a chief operating officer.

2022 Outlook - The company, for the first quarter, has said it expects revenue between $7.37 billion and $7.38 billion. It is higher than street estimates of $7.26 billion in revenue. The company’s updated guidance for the 2023 fiscal year is $32 billion to $32.1 billion in revenue, higher than street estimates of $31.78 billion in revenue.

Target price - The 45 analysts offering 12-month price forecasts for Salesforce have a median target of $315, with a high estimate of $385 and a low estimate of $210. The share price closed 0.78% lower on Tuesday at $208.89 per share.

Salesforce Q4 Results Review:

The company has beat the analysts' expectations both in the topline and bottom-line. The company is currently focused on integrating its products with Slack, the business chat app it purchased for $27.7 billion in 2020. On the acquisitions front, the company said there are no big acquisitions in the pipeline. The outlook for the next quarter and current financial year is also above street expectation which should be a positive sign for investors.

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