salesforce.com, inc. (NYSE: CRM) is having an incredibly strong start to the day in the pre-market hours, and for good reason. The company reported its earnings for the first quarter, not only blowing away expectations, but setting the stage for explosive growth ahead. Of course, the news proved to be a source of excitement for investors who are sending the stock screaming for the top. Today, we’ll talk about:
- The earnings report;
- what we’re seeing from the stock;
- and what we’ll be watching for with regard to CRM ahead.
CRM Reports Strong Earnings
As mentioned above, salesforce.com is having an incredibly strong start to the trading session in the pre-market hours after reporting its earnings for the first quarter. Here’s what we saw from the report:
- Revenue – In terms of revenue, CRM did overwhelmingly well, breaking the $3 billion mark for the first time in company history. During the quarter, analysts expected that the company would generate $2.94 billion in revenue. However, the company actually reported revenue in the amount of $3.01 billion. Not only did that figure beat analyst estimates, it showed incredibly strong growth over the $2.4 billion reported in the same period one year ago.
- Earnings – In terms of adjusted earnings, the company produced $0.74 per share. That was a big win when compared to expectations. During the quarter, analysts only expected that the company would report adjusted earnings in the amount of $0.46 per share.
- Guidance – Finally, the the company set the stage for a strong year ahead by reporting incredible guidance. During the second quarter, the company expects to generate earnings between $0.46 and $0.47 per share on revenue between $3.22 billion and $3.23 billion. On a full year basis, the company said that it expects to generate earnings between $2.29 per share and $2.31 per share on revenue in the range between $13.08 billion and $13.13 billion. Both quarterly and full year expectations are well ahead of analyst expectations.
In a statement, Marc Benioff, Chairman and CEO at CRM, had the following to offer:
Salesforce delivered more than $3 billion in revenue in the first quarter, surpassing a $12 billion annual revenue run rate… Our relentless focus on customer success is yielding incredible results, including delivering nearly 2 billion AI predictions per day with Einstein.
What We’re Seeing From The Stock
One of the first lessons that we learn when we start to dig into the market is that the news causes moves. In the case of salesforce.com, the news proved to be overwhelmingly positive. After all, strong earnings and guidance will excite just about any investor. So, it’s no surprise that the excitement is leading to gains in the market. Of course, our partners at Trade Ideas were the first to alert us to the gains. Currently (7:41), CRM is trading at $132.55 per share after a gain of $5.67 per share or 4.47% thus far today.
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What We’ll Be Watching For Ahead
Moving forward, the CNA Finance team will continue to keep a close eye on CRM. In particular, we’re interested in following the growth of the company as guidance proved to be great. Nonetheless, we’ll continue to follow the story closely and bring the news to you as it breaks!
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