Shulou(Shulou.com)11/24 Report--

Beijing time on December 1 morning news, the world's largest CRM software service provider Salesforce today announced the company's fiscal year 2023 third quarter results. According to the report, Salesforce's total revenue in the third quarter was $7.837 billion, up 14% from $6.863 billion in the same period last year, and 19% year-on-year, excluding exchange rate changes; net profit was $210 million, down 55% from $468 million in the same period last year; diluted earnings per share were $0.21, compared with $0.47 per diluted share in the same period last year.

Salesforce also announced that the company's co-CEO Brett Taylor (Bret Taylor) will leave, the current CEO and co-founder Mark Benioff (Marc Benioff) will become the sole head of the company.

Salesforce's third-quarter revenue and adjusted earnings per share beat Wall Street analysts' expectations, but the outlook for revenue for the fourth quarter and for the entire fiscal year 2023 was lower than expected, causing its shares to fall nearly 8 per cent in after-hours trading.

Main results: Salesforce's net profit for the quarter ended October 31 was $210 million, down 55% from $468 million in the same period last year, and diluted earnings per share were $0.21, compared with $0.47 per diluted share in the same period last year.

Excluding certain one-time items (not in accordance with GAAP), Salesforce's adjusted net income for the third quarter was $1.398 billion, compared with $1.273 billion in the same period last year, and adjusted diluted earnings per share were $1.40. compared with adjusted diluted earnings of $1.27 per share in the same period last year, the result beat analysts' expectations. On average, 39 analysts had expected Salesforce's adjusted earnings per share to reach $1.21 in the third quarter, according to Yahoo Finance.

Salesforce's third-quarter revenue was $7.837 billion, up 14% from $6.863 billion in the same period last year, and 19% year-on-year growth excluding currency changes, which also exceeded analysts' expectations. On average, 37 analysts had expected Salesforce's third-quarter revenue to reach $7.82 billion, according to Yahoo Finance.

By business category:-Salesforce's subscription and support business had revenue of $7.233 billion in the third quarter, compared with $6.379 billion in the same period last year, and accounted for 92 per cent of total revenue, compared with 93 per cent in the same period last year.

Within the subscription and support business:

(1) sales revenue in the third quarter was $1.717 billion, compared with $1.538 billion in the same period last year, with a year-on-year growth rate of 17% excluding exchange rate changes.

(2) Services revenue in the third quarter was $1.856 billion, compared with $1.658 billion in the same period last year, with a year-on-year growth rate of 16% excluding exchange rate changes.

(3) platform and other businesses had revenue of $1.513 billion in the third quarter, compared with $1.277 billion in the same period last year, with a year-on-year growth rate of 22% excluding exchange rate changes.

(4) Marketing and business revenue in the third quarter was $1.129 billion, compared with $1.006 billion in the same period last year, with a year-on-year growth rate of 18% excluding exchange rate changes.

(5) revenue from the data business in the third quarter was $1.018 billion, compared with $900 million in the same period last year, a year-on-year growth rate of 16% excluding exchange rate changes.

-Salesforce's professional services and other businesses generated revenue of $604 million in the third quarter, up 45 per cent from $484 million in the same period last year, and accounted for 8 per cent of total revenue, compared with 7 per cent in the same period last year.

By region:-Salesforce's revenue in the Americas was $5.361 billion in the third quarter, compared with $4.638 billion in the same period last year, a year-on-year growth rate of 16% excluding exchange rate changes

-European revenue in the third quarter was $1.745 billion, compared with $1.581 billion in the same period last year, with a year-on-year growth rate of 23% excluding exchange rate changes

-revenue from the Asia-Pacific business in the third quarter was $731 million, compared with $644 million in the same period last year, with a year-on-year growth rate of 30 per cent excluding exchange rate changes.

The total operating cost of Salesforce in the third quarter was $2.088 billion, compared with $1.844 billion in the same period last year. Of this total, the revenue cost of the subscription and support business was $1.451 billion, compared with $1.335 billion in the same period last year, and the revenue cost of professional services and other businesses was $637 million, compared with $509 million in the same period last year. Salesforce's total operating expenses accounted for 27% of revenue in the third quarter, the same as in the same period last year. Of this total, revenue costs for subscription and support businesses accounted for 19 per cent of revenue, compared with 20 per cent for the same period last year, and revenue costs for professional services and other businesses accounted for 8 per cent of revenue, compared with 7 per cent for the same period last year.

Salesforce's total operating expenses in the third quarter were $5.289 billion, compared with $4.981 billion in the same period last year. Of this total, R & D expenditure was $1.28 billion, compared with $1.203 billion in the same period last year; marketing and sales expenditure was $3.345 billion, compared to $3.111 billion in the same period last year; and general and administrative expenses were $6.64. compared to $667 million in the same period last year. Salesforce's operating expenses accounted for 67 per cent of total revenue in the third quarter, compared with 72 per cent in the same period last year. Of this total, R & D expenditure accounted for 16 per cent of total revenue, compared with 18 per cent in the same period last year; marketing and sales accounted for 43 per cent of total revenue, compared with 45 per cent in the same period last year; general and administrative expenses accounted for 8 per cent of total revenue, compared with 9 per cent in the same period last year.

Salesforce's third-quarter operating profit was $460 million, compared with $38 million in the same period last year; it accounted for 6 per cent of total revenue, or operating margin, compared with 1 per cent in the same period last year. Excluding certain one-time items (not in accordance with GAAP), Salesforce's adjusted operating profit in the third quarter was $1.777 billion, compared with $1.358 billion in the same period last year; its share of total revenue, or adjusted operating margin, was 22.7%, compared with 19.8% in the same period last year.

Cash from business operations in the third quarter of Salesforce was $310 million, down 23 per cent from the same period last year, while free cash flow was $120 million, down 52 per cent from the same period last year.

At the end of the third quarter, Salesforce's remaining performance obligations were $40 billion, up 10 per cent from the same period last year.

Performance outlook: fourth quarter performance outlook: Salesforce expects revenue of $7.932 billion to $8.032 billion in the fourth quarter of fiscal 2023, an increase of 8% to 10% over the same period last year, and its average ($7.982 billion) falls short of analysts' expectations. Loss per share is expected to reach 23 to 0.25 U.S. dollars. Earnings per share, which are not in accordance with GAAP, are expected to reach between $1.35 and $1.37, exceeding analysts' expectations.

On average, 37 analysts expected Salesforce's fourth-quarter revenue to reach $8.02 billion, while 39 analysts expected Salesforce's adjusted earnings per share to reach $1.34 in the fourth quarter, according to Yahoo Finance.

Outlook for fiscal year 2023: Salesforce also expects revenue of between $30.9 billion and $31 billion in fiscal 2023, an increase of about 17% year-on-year, and its average ($30.95 billion) falls short of analysts' expectations; earnings per share are expected to reach $0.55 to $0.57; earnings per share are expected to reach $4.92 to $4.94, not in accordance with GAAP, exceeding analysts' expectations Operating cash flow is expected to grow 16 per cent year-on-year; operating margins are expected to reach 3.8 per cent, and adjusted operating margins are expected to reach 20.7 per cent, not in accordance with US GAAP.

According to Yahoo Finance, 46 analysts had expected Salesforce's full-year revenue to reach $30.99 billion on average, while 45 analysts had expected Salesforce's full-year adjusted earnings per share to reach $4.73.

Share price reaction: Salesforce shares rose $8.57, or 5.65%, to $160.25 on the day. Salesforce shares fell 7.87 per cent, or $12.61, to $147.64 in after-hours trading as of 05:48 EDT on Wednesday (06:48 Beijing time on Thursday). In the past 52 weeks, the highest price for Salesforce is $276.94 and the lowest price is $136.04.

Welcome to subscribe "Shulou Technology Information " to get latest news, interesting things and hot topics in the IT industry, and controls the hottest and latest Internet news, technology news and IT industry trends.