Salesforce Set To Post Another Solid Quarter Backed By Growing Demand For Cloud-Based Products
With a track record of strong performances over the past few quarters, Salesforce.com (NYSE: CRM) is slated to report another solid quarter on 29th August 2018. The rising demand for cloud solutions and integrated end-to-end CRM solutions, coupled with a growing customer base, is likely to drive the company’s growth for the current and forthcoming quarters. While the company’s continued focus on acquisitions and partnerships could weigh on its bottom-line in the near term, it will allow the company to achieve its target of $20 billion sales and strengthen its lead position in the CRM space in the long term.
We currently have a price estimate of $155 per share, which is in line with the market price. View our interactive dashboard – Salesforce’s Outlook For 2018 and modify the key drivers to visualize the impact on its valuation.
- Down 7.3% In A Day, Where Is Salesforce Stock Headed?
- Up 69% In The Last Twelve Months, What To Expect From Salesforce Stock?
- Up 74% Since The Beginning of 2023, Will Salesforce Stock Continue Its Strong Rally?
- Salesforce Stock Is Undervalued
- Salesforce Stock To Edge Past The Consensus In Q1
- Salesforce Stock Is Trading Below Its Fair Value
Key Trends To Watch Out For In 2Q Results
- With customer preferences shifting toward cloud-based products, Salesforce.com’s revenue is expected to rise strongly driven by growth across cloud products and across geographies. Sales Cloud, the company’s flagship product, is likely to continue to be the largest contributor to the Subscription and Support segment.
- Further, the company’s reliance on its artificial intelligence (AI) CRM platform, Einstein, to enhance the adoption of its cloud solutions will further boost the top-line growth.
- Similar to the previous quarters, Salesforce.com’s operating expenses are expected to rise due to high spend on sales and R&D to effectively compete with rivals such as SAP and Microsoft. This is likely to weigh on the company’s bottom-line. However, this could be partially offset the improvement in margins due to increased adoption across product lines.
- For 2Q’18, Salesforce.com revenue is estimated to be in the range of $3.22-$3.23 billion and non-GAAP diluted EPS to be between $0.46 and $0.47 per share.
- Given the continued demand for its cloud-based products, Salesforce.com expects its full year 2019 revenue grow about 24%-25% on a year-on-year basis to $13.075-$13.125 billion. This includes roughly $315 million from the company’s acquisition of MuleSoft, which it closed in May of this year. However, due to the headwinds from the MuleSoft acquisition, the company anticipates its 2019 non-GAAP operating margin to improve by only 0%-0.25% to $2.29-$2.31 per share (diluted).
Do not agree with our forecast? Create your own price forecast for Salesforce.com by changing the base inputs (blue dots) on our interactive platform.