Customer relationship management software provider Salesforce has reported strong second-quarter results, with revenues of $5.15bn.
That marks a 29% year-over-year increase and an earnings beat as the US company surpassed the $4.9bn revenue forecasted by analysts.
Salesforce reported subscription revenues of $4.84bn for the fiscal second quarter ended 31 July, a 29% increase from the year-ago period.
The enterprise software company made $2.6bn in profit during Q2, although this was largely due to an accounting change that created tax advantages.
Salesforce, which sells a range of software solutions to assist sales teams, reported GAAP diluted earnings per share of $2.85.
Salesforce’s Q2 results come at time when many IT budgets are being scaled down due to the pandemic’s economic impact. However, companies offering cloud-based products have tended to fare better due to their low upfront costs.
“It’s humbling to have had one of the best quarters in Salesforce’s history against the backdrop of multiple crises seriously affecting our communities around the world,” said Marc Benioff, chair and CEO of Salesforce.
“Salesforce was founded on our belief in stakeholder capitalism and our core values of trust, customer success, innovation and equality. Our success in the quarter brought all of this together with the power of our Customer 360 platform, the resilience of our business model, putting our customers first and doing our part to take care of all of our stakeholders. We know that together we have an opportunity to emerge from these times even stronger.”
Salesforce Q2 results sparks raised Q3 guidance
Due to the better than expected Q2 results, Salesforce has raised its revenue guidance for Q3 from $5.24bn to $5.25bn.
“Despite a difficult economic climate, Salesforce delivered another quarter of strong growth, buoyed by a particularly impressive performance by Tableau,” said Angela Ashenden, principal analyst at research firm CCS Insights.
“However, growth was strong across the portfolio, highlighting the company’s crucial position in helping customers move their operations online during this crisis.”
Ashenden pointed to Salesforce’s ‘work.com’ social performance management platform as “very important in building its reputation as a trusted partner to its customers”.
Kris Rudeegraap, CEO at sending platform Sendoso, said: “The company’s continued strong performance shows that having connected customer data is more important than ever. The ensuing recession and slow reopening of the economy caused by the spread of Covid-19 has made it difficult to close deals and achieve growth.
“Revenue-generating teams have realised the need to make data-driven decisions if they hope to thrive, let alone survive, turning to Salesforce as a tool.”
Salesforce’s share price jumped 13% following the publication of its Q2 results and the stock is up by nearly 30% for the year-to-date.