SAN FRANCISCO -- Internet-based business software provider
reported a sharp increase in third-quarter profits, but failed to impress investors.
The company's shares were falling more than 3% after it reported net income of $6.5 million, or 5 cents a share, an improvement from $339,000, and break-even earnings per share for the same period a year ago.
The sales of a minority investment added a penny per share to the company's earnings this year. Excluding that gain, Salesforce.com still managed to beat analysts' consensus estimate of 3 cents a share, according to Thomson Financial.
Revenue rose 48% to $193 million, edging past analysts' average forecast of $190 million.
Chief executive Marc Benioff said the company generated $484 million in revenue in the first nine months of fiscal year 2007, which was more than it did in all of last year.
"At this rate, we expect to push well past the $800 million revenue run rate in Q4, and we are now on track to become the first ever on-demand company to exceed $1 billion in annual revenue in our fiscal '09," said Benioff.
In the fourth quarter, the company forecast earnings of 3-4 cents a share on revenue of $206 million to $208 million, roughly in line with analysts' average expectation of earnings at 4 cents a share earned on $207 million in revenue.
Shares were recently trading down $1.80 to $48.99.