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Salesforce.Com (CRM) Posts Better than Expected 3Q; Lifts Full Year Forecast

 November 20, 2012 04:43 PM

(By Balaseshan) Salesforce.com Inc. (NYSE: CRMreported a wider quarterly loss due to higher operating expenses and a charge to establish a valuation allowance against a significant portion of its deferred tax assets.

However, adjusted results beat market expectations and the enterprise cloud computing company raised full year forecast. The company also guided revenue for the fiscal 2014.

On a non-GAAP basis, earnings per share (EPS) declined 2.9 percent to 33 cents, yet beat Wall Street expectations of 32 cents. GAAP loss widened to $220.3 million from $3.76 million for the third quarter ended October 31 due to 40.9 percent rise in operating expenses and income tax expense.

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Revenue soared 35 percent to $788 million versus consensus estimate of 32.90 percent growth. Subscription and support revenue jumped 35 percent, while professional services and other revenues climbed 36 percent.

Deferred revenue on the balance sheet as of October 31, 2012 jumped 41 percent, while current deferred revenue climbed 35 percent benefiting in part by longer invoice durations.

Looking ahead for the fourth quarter, Salesforce.com forecasts non-GAAP EPS between 38 cents and 40 cents and revenue of $825 million to $830 million. Analysts expect EPS of 40 cents on revenue of $829.88 million.

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For the full year 2013, the company now expects non-GAAP EPS in the range of $1.50 to $1.52, up from prior expectations of $1.48 to $1.51. Revenue is now projected to be between $3.041 billion and $3.046 billion, up from $3.025 billion and $3.035 billion projected earlier. Analysts expect EPS of $1.50 on revenue of $3.03 billion.

For the fiscal 2014, the company anticipates revenue of about $3.80 billion to $3.85 billion, while the Street predicts $3.83 billion.

CRM stock, which has been trading in the 52-week range between $94.09 and $164.75, ended Tuesday's regular session down 0.96 percent at $145.90.

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