Salesforce stock is sinking on its Q2 earnings forecasts
Salesforce (CRM) shares are sinking after Wednesday’s market close as the cloud computing company reported mixed first-quarter earnings results. Salesforce posted $9.13 billion in revenue ($9.15 billion expected) and gains of $2.44 per share ($2.38 per share expected). The downward stock pressure is heavily attributed to Salesforce’s miss on second-quarter forecasts. The company is raising its full-year outlook
Yahoo Finance’s Julie Hyman and Josh Lipton weigh in on Salesforce’s guidance and commentary from CEO Marc Benioff.
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This post was written by Luke Carberry Mogan.
Video Transcript
Got to get to sales force earnings.
Those numbers just coming out, the shares falling a quick 9.5%.
That looks like it has to do with the forecast here.
Second quarter revenue seen at 9.2 to 9.25 billion.
Analysts have been looking for $9.35 billion.
Also the second quarter earnings per share forecast, which should be at most $2.36 compares with an analyst of $2.40 here.
Um, at the same time, it looks like the company is raising its full year earnings per share forecast here.
But folks are focusing on what’s going on with that second quarter forecast in terms of how the company did last quarter beat estimates when it comes to earnings per share.
244 versus the 238.
That was estimated revenue pretty much in line with it’s a $9.13 billion there.
But uh that forecast is sending those shares lower jobs.
Yeah, that’ll be the focus point.
I mean, I there were folks who were saying Julian given the results we saw from work day which of course, really disappointed investors and, and just generally what the streets use is kind of broad negativity towards software generally.
I, I think it’s fair to say a lot, even people who had, you know, folks had a buy on the, on the name, we’re not expecting a lot of upside, but clearly, this is disappointing ab about, about the forecast.
I’m just looking through the notes, what Mark Benioff had to say.
He’s kind of calling off profitable growth trajectory continuing.
He’s saying beginning of a massive opportunity for our customers to connect with their, our, our customers, connect with their customers uh in this whole new way with A I.
So trying to sound this positive tone, but the initial take here, um is obviously disappointing.
Well, and of course, Benioff had been sort of going back and forth with activists, then he seems to have sort of moved past that.
Um, but still has something to prove right in terms of slowing growth at the business here.
Uh The company did see 39% increase in cash flow every year as you point out that’s, you know, something that he is emphasizing.
But, um, you know, if you can’t deliver on what’s going on with the sales growth that people are looking for, then the stock gets smacked into the, the stock was basically flat this year.
Now, it’s getting shelled here at least initially in the after hours.
So we’ll keep watching it
