| Saleforces.com continues to defy the economic downturn, racking up another quarter which saw the Software-as-a-Service (SaaS) vendor increase sales by 20% on a year-over-year basis.
The San Francisco company reported that sales for the quarter ended July 31 came in at $316.1 million, up 20% from the same period in 2008. Subscription and support revenues made up $293.4 million of the total, while professional services and other revenues came in at $22.6 million.
The increased sales were in stark contrast to enterprise software rivals SAP, Oracle and Microsoft, which have struggled to maintain revenues in the midst of the downturn. In the most recent quarterly updates, SAP reported a 9.8% decline in revenue, Oracle a 5.2% decline, and Microsoft saw its revenues plummet 17% in the most recent quarter.
“We are pleased to report record revenue and GAAP earnings per share for our fiscal second quarter,” Salesforce.com Chief Executive Marc Benioff said in a statement. “We added 3,900 net new customers, bringing our total to more than 63,000 with our Service Cloud turning in its best quarter ever.”
Salesforce reported earnings of $21.2 million or 17 cents per share in the quarter, beating Wall Street estimates of 15 cents per share. The company also provided a third quarter forecast that will meet or beat analysts’ expectations. It is now projecting third quarter earnings of 15 to 16 cents a share, compared to the 15 cents Wall Street had expected.
The strong showing is expected to put even more pressure on SAP and Oracle to step up the game plans of their own SaaS or cloud initiatives. The companies have been moving cautiously into the market for fear of damaging their lucrative business models. The question, of course, is how long can they afford to let Salesforce chip away at their foundations?
Here are a few other highlights from the quarter:
• While paying customers rose 3,900 on a quarter-over-quarter basis, on a full year basis, paying customers have grown by 15,500 or 32%.
• Salesforce ended the quarter with 3,653 employees, up from 3,607 in the prior quarter.
• The company officially opened a new data center in Singapore to support the more than 5,000 customers it now has in the Asia-Pacific region.
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