Salesforce’s annual revenues surpass the $20bn mark

26 Feb 2021405 Views

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The enterprise software giant said that closing its $27bn purchase of Slack will impact its outlook.

Salesforce reported an increase in revenues last year, passing the $20bn mark for the first time, but it is adjusting forecasts as it closes its purchase of Slack.

In the last quarter, Salesforce reported $5.8bn in revenue, a 20pc year-over-year growth that exceeded analyst expectations, while its full-year revenue came in at $21.2bn. Net income for the year was $4bn.

In December 2020, Salesforce announced it was acquiring work communications software company Slack for $27bn. That deal is expected to be completed in the second quarter of this fiscal year.

Factoring in the Slack deal, Salesforce is forecasting its next quarterly earnings to be around the same as the previous quarter and expects the next full year to be up to $25.5bn. However, it is forecasting full-year profit that is below market expectations, which caused shares to fall by nearly 4pc in extended trading on Thursday (25 February).

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Amid the pandemic, Salesforce still derives the bulk of its revenue from its subscription cloud services. The company stated that it has also seen a revenue boost after its acquisition of analytics software firm Tableau in 2019.

As 2021 progresses, the company is positioning its software for coronavirus recovery efforts. In January it announced Vaccine Cloud, a suite of cloud software services for governments and health departments to manage their roll-outs of vaccines.

“We never could have predicted a year ago what was in store, which makes me incredibly proud of how well we pivoted our company to adapt to this pandemic world,” chief executive Marc Benioff said.

“We had a record quarter and year by innovating more and faster than ever, enabling our customers to be successful from anywhere, and becoming more relevant and strategic than ever. And we continued to serve all of our stakeholders in a time when they needed it most.”

Jonathan Keane is a freelance business and technology journalist based in Dublin

editorial@siliconrepublic.com