Customer relationship management solution provider Salesforce.Com Inc (NYSE: CRM) upwardly revised its FY 2022 revenue outlook and also issued revenue guidance for the fiscal year 2023. Furthermore, the company also initiated FY 2023 GAAP operating margin and non-GAAP operating margin guidance. Following the robust revenue outlook, the stock gained 7.21% or $18.69 to close Thursday’s trading session at $277.86.
The San Francisco, California-based company now expects full-year 2022 revenues of between $26.25 billion and $26.35 billion. Earlier, the company had issued FY 2022 revenue outlook in the range of $26.20 billion to $26.30 billion. Analysts surveyed by Refinitiv anticipate revenues of $26.31 billion.
For fiscal 2023, the cloud-based enterprise software solution provider forecasts revenues between $31.65 billion and $31.80 billion. The consensus estimate calls for revenues of $31.47 billion.
The company also forecasts FY 2023 GAAP operating margin of between 3% and 3.5%. Furthermore, the non-GAAP operating margin is projected to be 20%.
For the third quarter of fiscal 2022, analysts anticipate adjusted earnings of $0.92 per share on revenues of $6.80 billion. Likewise, for the fourth quarter of fiscal 2022, analysts anticipate the company to forecast earnings of $0.82 per share on revenues of $7.21 billion.
Notably, the company reported better-than-anticipated results for 2Q 2022. Specifically, Salesforce posted Q2 revenues of $6.34 billion, an increase of 23% on a y-o-y basis, exceeding Wall Street estimates of $6.23 billion. Also, the second-quarter adjusted earnings of $1.48 per share eclipsed Zacks Consensus estimate of $0.91 per share. The reported earnings reflect a 3% y-o-y increase, aided by solid topline growth and gains of $0.43 per share from strategic investments.
While subscription revenues rose by 22% y-o-y to $5.91 billion, professional services and other revenues increased 37% to $426 million. Salesforce ended the quarter with cash, cash equivalents, and marketable securities worth $9.65 billion, down from $15.02 billion at the end of the prior quarter.
The company benefited from a solid demand environment as clients went through a key digital transformation. The quick adoption of its cloud-based offerings enabled the company to post impressive results in the second quarter.
The upward revision of the FY 2022 revenue outlook and robust FY 2023 guidance is expected to keep the stock bullish in the short term.
Technically, the stock has firmly broken above the ascending triangle, as shown in the image below. Additionally, the stock is trading above its 50-day moving average. The Chaikin money flow indicator also has a positive reading. Therefore, we are anticipating the stock to remain in an uptrend in the short term.
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