Investors in Slack Technologies (NYSE:WORK) beat a booming market last year. Their stock jumped 88% in 2020 compared to the 16% increase logged by the S&P 500, according to data provided by S&P Global Market Intelligence.
Shares stayed ahead of the market for most of the year but ended 2020 on an especially strong note.
The rally was sparked by changes in global work habits that began immediately following widespread COVID-19 outbreaks in February and March. Investors bet that the shift to work-from-home status would benefit the messaging platform, and it did. Slack in early December announced surging sales, rising cash flow, and declining losses. Revenue jumped to $652 million from $448 million through the first three quarters of the year.
CEO Stewart Butterfield credited the pandemic for lifting results but said Slack's product momentum was driving the business higher as well. "We saw improving trends in the overall buying environment, and large enterprises continue to standardize on Slack," CFO Allen Shim said at the time.
Slack announced in early December that it had agreed to be purchased by software giant salesforce.com (NYSE:CRM) for roughly $28 billion. That massive purchase price includes a significant portion of Salesforce stock, and so Slack's share price will oscillate with changes in Salesforce's stock price until the deal's closing, which is expected to happen by mid-2021.