The 10-second takeaway
For the quarter ended Oct. 31 (Q3), salesforce.com, inc beat slightly on revenues and beat expectations on earnings per share.
Compared to the prior-year quarter, revenue grew significantly and GAAP loss per share grew.
Margins shrank across the board.
salesforce.com, inc tallied revenue of $788.4 million. The 36 analysts polled by S&P Capital IQ wanted to see revenue of $776.6 million on the same basis. GAAP reported sales were 35% higher than the prior-year quarter's $584.3 million.
Source: S&P Capital IQ. Quarterly periods. Dollar amounts in millions. Non-GAAP figures may vary to maintain comparability with estimates.
EPS came in at $0.33. The 38 earnings estimates compiled by S&P Capital IQ averaged $0.32 per share. GAAP EPS were -$1.55 for Q3 compared to -$0.03 per share for the prior-year quarter.
Source: S&P Capital IQ. Quarterly periods. Non-GAAP figures may vary to maintain comparability with estimates.
For the quarter, gross margin was 76.4%, 160 basis points worse than the prior-year quarter. Operating margin was -6.9%, 520 basis points worse than the prior-year quarter. Net margin was -27.9%, 2,730 basis points worse than the prior-year quarter.
Next quarter's average estimate for revenue is $830.1 million. On the bottom line, the average EPS estimate is $0.40.
Next year's average estimate for revenue is $3.04 billion. The average EPS estimate is $1.51.
Of Wall Street recommendations tracked by S&P Capital IQ, the average opinion on salesforce.com, inc is outperform, with an average price target of $174.28.
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Seth Jayson had no position in any company mentioned here at the time of publication. You can view his stock holdings here. He is co-advisor of Motley Fool Hidden Gems, which provides new small-cap ideas every month, backed by a real-money portfolio. The Motley Fool has the following options: long JAN 2013 $50.00 puts on Salesforce.com, long JAN 2013 $50.00 puts on Salesforce.com, and short JAN 2013 $50.00 calls on Salesforce.com. Motley Fool newsletter services recommend Salesforce.com. Try any of our Foolish newsletter services free for 30 days. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy.