The customer relationship management (CRM) software company's stock has been steadily climbing over the years as the business continues to post impressive growth.
Salesforce.com is the market leader in CRM software, reigning at number one in terms of revenue for seven consecutive years. The software-as-a-service company continues to grow its subscription revenue at a steady pace, up 26.3% year over year for the first nine months of the fiscal year 2021 ended Oct. 31, 2020, to $14.5 billion. Revenue guidance provided by the company for its fiscal year 2022 is for 21% year-over-year growth, as Salesforce's growth momentum continues unabated.
During its recent Investor Day held in early December, Salesforce estimated that its total addressable market will be worth around $175 billion by 2025, and that the compound annual growth rate for this addressable market will hit 11% from 2021 to 2025. The company has successfully executed its "land and expand" strategy to grow its customer base and increase the number of use cases per customer. Annual recurring revenue for customers acquired in the fiscal year 2017 has doubled over four years, demonstrating the effectiveness of this strategy.
Salesforce has just announced its largest acquisition to date last month, entering an agreement to purchase Slack Technologies (NYSE:WORK) at an enterprise value of around $27.7 billion. By integrating Slack's platform with Salesforce's, the combined entity will provide a unified platform for connecting employees, customers, and other stakeholders to augment their existing workflow. Management believes that this acquisition can enhance the company's service offering to its clients and help it to create an extensive open ecosystem for smoother business workflow.
This acquisition comes at an opportune time: Salesforce also announced the launch of Salesforce Hyperforce, a revamp of the company's platform to deliver its suite of cloud services on major public cloud networks.
Both the launch of Hyperforce and the purchase of Slack should ensure Salesforce can continue to grow in the years to come and maintain its pole position as the dominant global CRM software provider.