CRM giant's strong Q2, FY20 results prompt FY20 full-year guidance increase
Salesforce chalked up a 36 per cent year-on-year revenue increase across its Marketing and Commerce Cloud portfolio in the second quarter of FY20, according to its latest financial results.
As part of its Q2 and half-yearly financial announcement to the market, the CRM software giant confirmed total global second-quarter revenue to 31 July 2019 was up 22 per cent to US$4 billion, with subscription and support revenues equating to $3.75 billion. The remaining revenue of $252 million included professional services, also up 14 per cent year-on-year.
The results brought total half-year revenue to $7.2 billion, up from $5.8 billion.
Across product lines, Sales Cloud was not surprisingly the biggest earner, representing second-quarter revenue of $1.1 billion, up 13 per cent year-on-year, or $2.2 billion for the six-month period.
But the ever-expanding Marketing and Commerce Cloud offering showed the strongest growth result, lifting 36 per cent year-on-year with Q2 revenues of $616 million. This equated to $1.2 billion for the second-half.
In its financial statement, the company quoted Gartner research showing it had 12 per cent market share in marketing technology for the 2018 calendar year, giving it a second position market rank. In Commerce, meanwhile, Gartner states Salesforce had 7 per cent market share in 2018, sitting in third position.
Service Cloud was the vendor’s second-highest revenue product portfolio, with Q2 revenue of just over $1 billion for the three months ending 31 July, or $2.1 billion in the six-month period.
Off the back of the strong results, Salesforce lifted Q3 FY20 guidance to $4.44 - $4.45 billion, and full-year FY20 guidance to $16.75 - $16.9 billion, representing 26-27 per cent year-on-year growth.
“With our Customer 360 vision, Einstein AI and the millions of Trailblazers innovating on our platform, Salesforce has never been better positioned for the future,” said Salesforce chairman and co-CEO, Marc Benioff.
Salesforce co-CEO, Keith Block, also attributed the strong results to the wave of digital transformation sweeping across every industry, and said major brands, such as FedEx, AXA and Unicredit, are turning to Salesforce for help.
“The trust our customers have in us to drive their digital transformations is reflected in our strong quarterly results across our clouds and regions,” he commented.
It's also been a busy FY20 for Salesforce in terms of mergers and acquisitions, with the company announcing it planned to acquire data visualisation vendor, Tableau, for a whopping US$15.7 billion in June.
Other strategic acquisitions in the last 18 months include data analytics player, Datorama, MuleSoft and ClickSoftware.
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