Earnings performance
Salesforce reported adjusted earnings of $2.44 per share, slightly higher than the $2.38 per share expected by analysts surveyed by LSEG. However, the company’s revenue for the quarter came in at $9.13 billion, a deviation from the forecasted $9.17 billion. This shortfall was a key factor in the sharp decline in Salesforce’s stock price.
Advice disappoints
Looking ahead, Salesforce provided guidance for the current quarter that also disappointed investors. The company expects adjusted earnings per share of between $2.34 and $2.36 on revenue of between $9.2 billion and $9.25 billion. Analysts had forecast adjusted earnings per share of $2.40 on revenue of $9.37 billion, according to LSEG. This conservative outlook put additional pressure on Salesforce shares after hours.
Quarterly revenue and revenue growth
Despite the lack of revenue, Salesforce reported an 11% increase in revenue compared to the same period last year, with fiscal first quarter revenue increasing from $8.25 billion to $9.13 billion. dollars. Net income saw a significant increase to $1.53 billion, or $1.56 per share, from $199 million, or 20 cents per share, a year ago. This substantial improvement in net income highlights the company’s ability to increase profitability despite revenue challenges.
Impact on the Dow Jones Industrial Average
As a member of the Dow Jones Industrial Average, Salesforce’s performance can influence the broader market index. The significant decline in Salesforce’s stock price could weigh on the Dow, reflecting investor sentiment and potentially leading to broader market ripples.
Market Forecast
Given the weaker-than-expected revenue and cautious guidance, Salesforce’s near-term outlook appears bearish. Traders and investors may see continued volatility in the stock, especially as the company navigates its revenue challenges and market expectations. The upcoming analyst call will be crucial in providing further insight into Salesforce’s strategic responses to these financial pressures.
