Salesforce posts slowest quarterly revenue growth since 2010

<html xmlns=""><head><title>UPDATE 4-Salesforce posts slowest quarterly revenue growth since 2010</title></head><body>

Adds executive comment in paragraph 4, details on results in paragraphs 5 and 10

By Tiyashi Datta

May 31 (Reuters) -Salesforce Inc CRM.N posted an 11% rise in quarterly revenue, its slowest pace of growth in 13 years, as companies dialed back spending on cloud-based software offerings in an uncertain economy.

Shares of the San Francisco, California-based company fell nearly 5% in trading after the bell. They have surged by more than two-thirds so far this year and rose to their highest in about 16 months in regular trading on Wednesday.

Growth at major cloud players from Microsoft Corp MSFT.O to Inc AMZN.O has come under pressure this year as businesses undertake belt-tightening measures to weather the impact of rising interest rates and a potential economic slowdown.

Salesforce Chief Financial Officer Amy Weaver said the company faced continued macroeconomic pressures in the United States and that demand from financial services and technology companies slowed in the quarter.

Capital expenditure also jumped nearly 36% to $243 million as the company invested in AI-related tools to power its software products.

Revenue for Salesforce was $8.25 billion for the quarter ended April 30, while analysts were expecting $8.18 billion, according to Refinitiv IBES.

RBC analyst Rishi Jaluria attributed the stock's fall in extended trading to its surge this year and the company's narrow revenue beat relative to its historical performance.

The company faces stiff competition from deep-pocketed legacy vendors such as Oracle ORCL.N in a crowded cloud-computing market.

It has also been a constant target of activist investors such as ValueAct, Inclusive Capital and Starboard Value, which have all separately pushed for better cost control initiatives and improved efficiencies.

Salesforce expects revenue of between $8.51 billion and $8.53 billion for the current quarter, representing growth of about 10% from last year. Analysts were expecting revenue of $8.49 billion.

On an adjusted basis, Salesforceearned $1.69 per share, compared with the estimates of $1.61 per share.

Salesforce revenue growth since 2010

Salesforce revenue growth since 2010

Reporting by Tiyashi Datta in Bengaluru; Editing by Anil D'Silva


Disclaimer: The XM Group entities provide execution-only service and access to our Online Trading Facility, permitting a person to view and/or use the content available on or via the website, is not intended to change or expand on this, nor does it change or expand on this. Such access and use are always subject to: (i) Terms and Conditions; (ii) Risk Warnings; and (iii) Full Disclaimer. Such content is therefore provided as no more than general information. Particularly, please be aware that the contents of our Online Trading Facility are neither a solicitation, nor an offer to enter any transactions on the financial markets. Trading on any financial market involves a significant level of risk to your capital.

All material published on our Online Trading Facility is intended for educational/informational purposes only, and does not contain – nor should it be considered as containing – financial, investment tax or trading advice and recommendations; or a record of our trading prices; or an offer of, or solicitation for, a transaction in any financial instruments; or unsolicited financial promotions to you.

Any third-party content, as well as content prepared by XM, such as: opinions, news, research, analyses, prices and other information or links to third-party sites contained on this website are provided on an “as-is” basis, as general market commentary, and do not constitute investment advice. To the extent that any content is construed as investment research, you must note and accept that the content was not intended to and has not been prepared in accordance with legal requirements designed to promote the independence of investment research and as such, it would be considered as marketing communication under the relevant laws and regulations. Please ensure that you have read and understood our Notification on Non-Independent Investment. Research and Risk Warning concerning the foregoing information, which can be accessed here.

We are using cookies to give you the best experience on our website. Read more or change your cookie settings.

Risk Warning: Your capital is at risk. Leveraged products may not be suitable for everyone. Please consider our Risk Disclosure.