Salesforce.com Inc. gave a revenue forecast that fell short of estimates, stoking concern the torrid pace of the cloud software maker’s growth has stalled. Shares declined about 3 per cent in extended trading.
Sales will be US$3.67 billion to US$3.68 billion in the period ending in April, the San Francisco-based company said Monday in a statement. On average, analysts estimated US$3.7 billion, according to data compiled by Bloomberg. The company’s profit forecast also missed projections.
The projected revenue growth of 22 per cent in the current quarter would be the smallest year-over-year increase since at least 2010 for the leader in cloud-based customer-relations software. Investors were expecting more, said Pat Walravens, an analyst at JMP Securities.
“Investors like to see an acceleration,’’ he said.
Salesforce co-Chief Executive Officers Marc Benioff and Keith Block announced a new annual revenue goal of US$26 billion to US$28 billion by fiscal year 2023. To reach the goal, Salesforce is spending a lot of money opening new offices around the world, hiring more workers and buying other businesses over the last year. The company said in January that it plans to hire about 1,500 new employees in Ireland over the next five years.
Revenue increased 26 per cent to US$3.6 billion in the fiscal fourth quarter. Block brushed off any issues with Salesforce’s growth.
“We just finished an outstanding fourth quarter and we feel very, very good about the business,’’ he said in an interview. “Our guide reflects our business. It’s strong.”
The stock has gained 16 per cent this year, closing at US$158.50 in New York.
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