Salesforce Inc. started in the year 1999 and is a leader in the cloud computing software industry today. Something that started as a small company by four software developers is now surpassing $13 billion in revenue for the fiscal year (FY) ending in January 2019.
Salesforce has reclaimed its running streak of a high growth rate over the years despite some fallbacks in the second and third quarter of the fiscal year 2018-2019.
The Numbers
The fiscal year 2019 marks the 20th anniversary of Salesforce operating in customer relationship management, marketing automation, customer service, and analytics.
FY19 saw promising operational revenue of $3,398 million at a 24% year-over-year increase. The GAAP financial metrics presented the total annual revenue at 13,282 million at a 26% year-over-year increase whereas non-GAAP financial metrics presented values at $13,243 million with a constant currency Y-O-Y growth rate of 26%.
Crediting to its strong prominence for providing cost-effective innovative and secure software solutions, Salesforce has been constantly expanding its horizons for many years now. Salesforce emphasizes solving its clients’ problems by providing in-depth functionality without jeopardizing the concept of cost-efficiency.
Therefore, the company holds a major market share in its respective industry. The market share for FY19 accounted for a total of 25% with a 23% hike in its customer-relationship management revenues.
Then vs. Now
The Software as a Service (SaaS) company offers several major services, out of which, commerce-cloud services and marketing cloud services stand together at $1.3 billion combined. The sector of these CRM products has experienced a growth of 34% year over year, which accounts for almost 15% of the total CRM product portfolio.
Similar performance had been recorded quarterly by the company and observed by investors when the total revenue in the Q4 stood at $3,603 million (GAAP metrics) and $3,641 (non-GAAP metrics). The metrics accounted for a year over year increase of 26% and 27% CC respectively.
While these were statistics for FY19, it depicts significant improvement when compared to the company’s earnings for the previous year, FY18. The total revenue increased by $2,802 million from $10,480 million (GAAP metrics) and by $2,862 from $10,381 CC (Non-GAAP metrics).
The cause behind this significance might have to do with the fact that in the past few years, the company has expanded its customer base not only through small clients but has also paved its path through some major clients.
Earlier, major companies did not trust an outsourced service for cloud computing, but now, due to technological improvements in terms of security, encryption, and storage space, Salesforce has acquired good business in recent times.
The company has partnered with several other big names such as Facebook, Apple, AWM, IBM, and Google in the past few years. This has resulted in greater interest from customers, investors, and prospective investors.
Predictions for the future
Salesforce believes that it will be able to work with digitally transforming imperatives and will be able to innovate and provide over 500 million new solutions to its client base by the year 2023. It aims to work with its partners to refine mobile experiences.
The organization expects to take over a major share of the market by FY22 through its commerce and marketing products in the CRM segment. They also aim to use their cloud leading advantage and multi-cloud advantage in their sales and marketing products.
The compound annual growth rate is expected to be 20% in the coming fiscal years with a target of achieving revenue of $21-23 billion, almost twice as much as FY19.
Salesforce has reclaimed its running streak of a high growth rate over the years despite some fallbacks in the second and third quarter of the fiscal year 2018-2019.
The Numbers
The fiscal year 2019 marks the 20th anniversary of Salesforce operating in customer relationship management, marketing automation, customer service, and analytics.
FY19 saw promising operational revenue of $3,398 million at a 24% year-over-year increase. The GAAP financial metrics presented the total annual revenue at 13,282 million at a 26% year-over-year increase whereas non-GAAP financial metrics presented values at $13,243 million with a constant currency Y-O-Y growth rate of 26%.
Crediting to its strong prominence for providing cost-effective innovative and secure software solutions, Salesforce has been constantly expanding its horizons for many years now. Salesforce emphasizes solving its clients’ problems by providing in-depth functionality without jeopardizing the concept of cost-efficiency.
Therefore, the company holds a major market share in its respective industry. The market share for FY19 accounted for a total of 25% with a 23% hike in its customer-relationship management revenues.
Then vs. Now
The Software as a Service (SaaS) company offers several major services, out of which, commerce-cloud services and marketing cloud services stand together at $1.3 billion combined. The sector of these CRM products has experienced a growth of 34% year over year, which accounts for almost 15% of the total CRM product portfolio.
Similar performance had been recorded quarterly by the company and observed by investors when the total revenue in the Q4 stood at $3,603 million (GAAP metrics) and $3,641 (non-GAAP metrics). The metrics accounted for a year over year increase of 26% and 27% CC respectively.
While these were statistics for FY19, it depicts significant improvement when compared to the company’s earnings for the previous year, FY18. The total revenue increased by $2,802 million from $10,480 million (GAAP metrics) and by $2,862 from $10,381 CC (Non-GAAP metrics).
The cause behind this significance might have to do with the fact that in the past few years, the company has expanded its customer base not only through small clients but has also paved its path through some major clients.
Earlier, major companies did not trust an outsourced service for cloud computing, but now, due to technological improvements in terms of security, encryption, and storage space, Salesforce has acquired good business in recent times.
The company has partnered with several other big names such as Facebook, Apple, AWM, IBM, and Google in the past few years. This has resulted in greater interest from customers, investors, and prospective investors.
Predictions for the future
Salesforce believes that it will be able to work with digitally transforming imperatives and will be able to innovate and provide over 500 million new solutions to its client base by the year 2023. It aims to work with its partners to refine mobile experiences.
The organization expects to take over a major share of the market by FY22 through its commerce and marketing products in the CRM segment. They also aim to use their cloud leading advantage and multi-cloud advantage in their sales and marketing products.
The compound annual growth rate is expected to be 20% in the coming fiscal years with a target of achieving revenue of $21-23 billion, almost twice as much as FY19.
