Salesforce, Gartner reports show cautious optimism for CRM

Share this content:

This week, Inc. reported net income for the fiscal fourth quarter nearly double that of last year's, showing that, in a receding economy, CRM and software-as-a-service (SaaS) providers may prove to be a bright spot.

Although it has lately been bogged down by falling stock prices and the February departure of president and chief strategy officer Steve Cakebread, Salesforce actually surpassed sales and earnings estimates for the quarter, which ended January 31. For the quarter, net income was $13.8 million, a $6.4 million increase from the same period the year before. Revenue grew 34% to $289.6 million. Revenue for the year increased 44% from fiscal year 2008 to reach $1.08 billion.

The company's success follows trends revealed in a recent Gartner Inc. report. The report, released Thursday, showed that CRM was the No. 2 technology priority for CIOs worldwide in 2009. The report also predicts that nearly 50% of all field sales applications be delivered through SaaS by 2012, compared with less than 1% in 2000. The percentage of all CRM applications delivered through SaaS will be closer to 25% in 2012 but up to 40% in 2020 — all good news for, which has been a major promoter of SaaS in the CRM marketplace.

Salesforce attributed some of its 2008 success to deals won at the expense of Oracle and SAP, heavy-hitters in the CRM space that have more limited SaaS options. However, Oracle, which also provides SaaS with its Oracle CRM On Demand, has reported 6% growth in GAAP total revenue, to $5.6 billion, in its most recent quarter, which ended November 30. SAP, another competitor that does not focus on SaaS, saw its revenue grow 8% in its fourth quarter, which ended December 31, and 13% in 2008.

In spite of the strong numbers, CRM big shots are, like most companies, treading cautiously now. Salesforce, which predicted revenues of $1.35 billion to 1.36 billion in November for fiscal 2010, has since lowered those projections to around $1.3 billion. SAP declined to provide an outlook for the coming year, “due to the continued uncertainty surrounding the economic and business environment.”


Next Article in Data/Analytics

Sign up to our newsletters

Company of the Week

PAN Communications is an award-winning integrated marketing and public relations agency for B2B technology and healthcare brands. PAN's data-driven approach allows the firm to specialize in public relations, social media, content and influencer marketing, and data and analytics. PAN partners with brands to create unique, integrated campaigns that captivate audiences and drive measurable results. PAN services clients out of the firm's four offices: Boston, San Francisco, New York City and Orlando.

Find out more here »

Career Center

Check out hundreds of exciting professional opportunities available on DMN's Career Center.  
Explore careers in digital marketing, sales, eCommerce, marketing communications, IT, data strategies, and much more. And don't forget to update your resume so employers can contact you privately about job opportunities.

>>Click Here

Relive the 2017 Marketing Hall of Femme

Click the image above