Salesforce Shares Soar 7% on Raised Outlook

February 24, 2016, 9:40 PM UTC
Key Speakers At Cannes Lions International Festival Of Creativity
Marc Benioff, chief executive officer of Inc., speaks during a panel session at the Cannes Lions International Festival Of Creativity in Cannes, France, on Wednesday, June 24, 2015. The advertising industry's largest annual gathering runs from June 21 to June 27. Photographer: Christophe Morin/Bloomberg via Getty Images
Photograph by Bloomberg via Getty Images

(Reuters) – reported higher-than-expected fourth-quarter revenue and raised its full-year revenue forecast, driven by higher demand for its web-based sales and marketing software.

Shares (CRM) of the world’s largest maker of online sales software rose 7.2% to $67 in after-hours trading.

Salesforce, seen as a barometer for the cloud-computing sector, has been benefiting as more businesses choose cheaper and easier cloud software services.

The San Francisco-based company provides its services online, with no software directly installed on PCs.

Salesforce raised full-year revenue forecast to $8.08 billion-$8.12 billion from $8.0 billon-$8.1 billion and said it expects adjusted profit of $0.99-$1.01 per share.

Analysts on average were expecting a profit of 99 cents per share on revenue of $8.08 billion, according to Thomson Reuters I/B/E/S.

Revenue from sales cloud – suite of software that allows companies to track leads, forecast opportunities and collaborate around any sale – rose 12.3% to $708.9 million.

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Net loss narrowed to $25.5 million, or 4 cents per share, in the fourth quarter ended Jan. 31, from $65.8 million, or 10 cents per share, a year earlier.

Excluding items, the company earned 19 cents per share, in line with the average analyst estimate.

Revenue rose 25.3% to $1.81 billion, above analysts’ estimate of $1.79 billion.

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