Summary
Salesforce, Inc. (CRM) reported its first quarter fiscal year 2014 results, ending April 30, 2013, showing continued revenue growth but also an increased net loss compared to the prior year. Total revenues grew 28% year-over-year to $892.6 million, driven primarily by subscription and support services. However, the company posted a net loss of $67.7 million, widening from a $19.5 million loss in the same period last year. This increased loss was influenced by significant investments in marketing and sales, research and development, and higher stock-based compensation expenses. The company also successfully raised substantial capital through a $1.15 billion convertible senior notes offering, bolstering its cash position to $3.1 billion in cash, cash equivalents, and marketable securities. Despite the net loss, the company's operating cash flow remained positive and strengthened year-over-year. Key strategic developments during the quarter included the issuance of new convertible senior notes and the completion of a four-for-one stock split. The company continues to emphasize its strategy of transforming customers into 'customer companies' through its cloud-based solutions. While growth in revenues is robust, investors should monitor the increasing operating expenses and net loss, alongside the company's significant cash reserves and ongoing investment in future growth.
Financial Highlights
49 data points| Revenue | $892.63M |
| Cost of Revenue | $208.99M |
| Gross Profit | $683.64M |
| R&D Expenses | $131.94M |
| Operating Expenses | $728.18M |
| Operating Income | -$44.54M |
| Interest Expense | $11.88M |
| Net Income | -$67.72M |
| EPS (Basic) | $-0.12 |
| EPS (Diluted) | $-0.12 |
| Shares Outstanding (Basic) | 588.38M |
| Shares Outstanding (Diluted) | 588.38M |
Key Highlights
- 1Total revenues increased by 28% to $892.6 million, driven by a 29% rise in subscription and support revenue.
- 2Net loss widened to $67.7 million from $19.5 million in the prior year's quarter, primarily due to increased operating expenses.
- 3Operating expenses rose significantly, with Marketing and Sales up 26%, Research and Development up 39%, and General and Administrative up 28%.
- 4The company successfully raised $1.15 billion through the issuance of 0.25% convertible senior notes.
- 5Cash, cash equivalents, and marketable securities increased significantly to $3.1 billion.
- 6A four-for-one stock split was completed in April 2013, affecting share and per share data.
- 7Operating cash flow increased to $283.2 million from $213.2 million in the prior year's quarter.