![]() Salesforce is widely considered a leader in each of its served markets, which is attractive on its own, but the tight integration among the solutions and the natural fit they have with one another makes for a powerful value proposition, in our view. In our view, Salesforce will benefit further from natural cross-selling among its clouds, upselling more robust features within product lines, pricing actions, international growth, and continued acquisitions such as the recent Tableau deal and the pending Slack deal. We believe this further strengthens the substantial community of Salesforce users. Salesforce Platform also offers customers a platform-as-a-service solution, complete with the AppExchange, as a way to rapidly create and distribute apps. These solutions encompass nearly all aspects of customer acquisition and retention and, in our view, are mission critical. Service Cloud brought in customer service applications, and Marketing Cloud delivers marketing automation solutions. ’s critical differentiator was that the software was accessed through a web browser and delivered over the Internet, thus inventing the SaaS software delivery model. Sales Cloud represents the original salesforce automation product, which streamlined process management for sales leads and opportunities, contact and account data, process tracking, approvals, and territory tracking. Even as revenue growth is likely to dip below 20% for the first time at some point in the next several years, we believe ongoing margin expansion should continue to compound earnings growth of more than 20% annually for much longer.Īfter introducing the software-as-a-service model to the world, has assembled a front-office empire that it can build on for years to come, in our view. We believe represents one of best long-term growth stories in software. ![]() Strong revenue and expense discipline drove margin and EPS upside.īusiness Strategy and Outlook | Dec 02, 2020 Non-GAAP EPS of $1.74 benefited by $0.86 from mark-to-market accounting, but were still $0.10 better than our above consensus estimate. Non-GAAP operating margin was strong at 19.8%, compared with 19.4% a year ago and our above-consensus model at 17.7%. ![]() ![]() Billings and current remaining performance obligation, or CRPO, both grew more slowly than revenue, which is a bit of a blemish on an otherwise good quarter. Demand remains strong on all fronts and attrition remains better than management anticipated. All segments were ahead, with the most notable upside relative to our model coming from platform and marketing cloud, which were 5% and 4% ahead of our estimates, respectively. Revenue grew 20% year over year to $5.419 billion, which blew through both our above-consensus estimate and guidance. ![]()
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