Salesforce Inc. (NYSE: CRM) reported a swing to profit in the fiscal 2024 fourth quarter. The company also issued better-than-anticipated earnings and revenues. However, the customer relationship management solution provider issued a slightly weak revenue outlook for FY 2025. The company also initiated its first-ever dividend payments and announced a share repurchase program. The stock ended Thursday’s trading session at $308.82, up $9.05, or 3.02%, from the prior close.
The San Francisco, California-based company reported fourth-quarter revenues of $9.29 billion, up 10.80% from $8.38 billion in the comparable quarter of fiscal 2023.
For the recent quarter, which ended January 31, 2024, the company reported net income of $1.45 billion, or $1.47 per share, compared with a net loss of $98 million, or $0.10 per share, in the quarter that ended January 31, 2023.
Excluding amortization of purchased intangibles, stock-based compensation expense, restructuring expenses, and income tax effects and adjustments, among others, the business software provider posted 4Q 2024 non-GAAP net income of $2.25 billion, or $2.29 per share, an increase from $1.66 billion, or $1.68 per share in 4Q 2023.
Analysts surveyed by LSEG had anticipated the company to report adjusted earnings of $2.26 per share on revenues of $9.22 billion.
Commenting on the results, Marc Benioff, Chair & CEO, of Salesforce, stated, “It’s been a phenomenal year of transformation for Salesforce, with strong performance across all our key metrics, including record cash flow and margin growth.”
Segment wise:
- Subscription and support revenues grew by 12.30% y-o-y to $8.75 billion. Specifically, sales revenues rose by 10.20% y-o-y to $1.97 billion. Service revenues increased by 12.20% y-o-y to $2.16 billion. Platform and other revenues were $1.72 billion, up 10.50% from the previous year. Marketing and commerce revenues were $1.27 billion, an increase of 8.24% on a y-o-y basis. Integration and analytics revenues surged 21.05% to $1.63 billion.
- Professional services and other revenues were $539 million, down from $595 million last year.
Looking forward, Salesforce projected fiscal 2025 first-quarter revenues in the range of $9.12 billion to $9.17 billion. The company also expects Q1 adjusted earnings of between $2.37 and $2.39 per share. Analysts surveyed by LSEG anticipate the company to report adjusted earnings of $2.20 per share on revenues of $9.15 billion.
For FY 2025, Salesforce forecasts $37.70 billion to $38 billion in revenues. The company also projects FY 2025 adjusted earnings in the range of $9.68 to $9.76 per share. Wall Street analysts anticipate the company to report adjusted earnings of $9.57 per share on revenues of $38.62 billion.
The company also announced its first-ever quarterly dividend of $0.40 per share, payable on April 11. Salesforce intends to continue paying quarterly dividends.
The quarterly earnings beat, solid Q1 outlook, and dividend declaration are expected to keep the stock of Salesforce slightly bullish in the short term.
The historical price chart indicates that the stock of Salesforce is ascending after consolidating around $300. The stock is also trading above its 50-day moving average, while the MACD indicator is showing a positive reading. Therefore, we anticipate the stock price of Salesforce to remain in an uptrend in the near term.
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