Salesforce (CRM) Q4 2024 Earnings Report

Salesforce shares initially fell as much as 6% but then rose 1% in extended trading on Wednesday after the business software maker issued a soft revenue forecast for the new fiscal year. It will begin paying a dividend of 40 cents per share.

Here’s how the company fared compared to the ratings of LSEG, formerly known as Refinitiv:

• Earnings per share: $2.29 adjusted vs. $2.26 expected
• Income: $9.29 billion vs. $9.22 billion expected

Salesforce’s revenue rose 10.8% year over year in the quarter ended Jan. 31, according to a statement. Professional services revenue was down 9%. The company reported net income of $1.45 billion, or $1.47 per share, compared with a loss of $98 million, or 10 cents per share.

“Over the last two quarters, I’m happy to say we’ve seen improved booking growth,” Amy Weaver, Salesforce’s CFO, said on a conference call with analysts.

During the quarter, Salesforce said it would acquire a sales commission software startup spicy for undisclosed terms and was beginning to sell its products to Amazon Web services Market.

Salesforce called for adjusted fiscal first-quarter earnings of $2.37 to $2.39 per share, on revenue of $9.12 billion to $9.17 billion. Analysts polled by LSEG had expected $2.20 in adjusted earnings per share on revenue of $9.15 billion.

For the new fiscal year 2025, Salesforce said it sees adjusted earnings of $9.68 to $9.76 per share and $37.7 billion to $38.0 billion in revenue. The revenue figure suggests 8.6% growth in the middle of the range. Analysts had expected $9.57 per share on revenue of $38.62 billion.

Full-year guidance takes into account foreign currency pressures and continued weakness in professional services, Weaver said. Plus, it reflects a more measured buying environment that first appeared in fiscal 2023, she said.

While demand for AI products is strong, the guidance doesn’t account for much of the impact of this category, said Brian Milham, president and chief operating officer of Salesforce. The price hike announced last year also won’t be a major factor, Milham said.

The adoption of AI internally should contribute to margin expansion over time, he said.

Excluding after-hours trading, Salesforce shares are up about 14% so far this year, while the S&P 500 is up 6% over the same period.

Salesforce’s dividend was paid on April 11 to shareholders at the close of business on March 14.

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