Salesforce: Nothin' but Net

Salesforce soundly beats Wall Street estimates with 34% revenue growth.
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SAN FRANCISCO -- Raise your hand if you'd settle for 34% revenue growth over the past three months.

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is probably thinking the same thing.

The San Francisco-based provider of online business software beat Wall Street's fourth-quarter estimates Wednesday and struck out on the lonely path of


saying that analysts' projections for the year ahead were too high.

Salesforce's fourth-quarter net income rose to $13.8 million, or 11 cents a share, from $7.4 million, or 6 cents a share, a year earlier.

Analysts had been expecting the company to earn 7 cents a share.

Revenue rose to $289.6 million from $216.9 million last year, topping the Wall Street consensus estimate of $285.2 million.

The company said net paying customer additions rose 3,600 during the quarter to 54,000. In the third quarter, Salesforce added 4,100 net customers.

Shares of Salesforce, which moved 2.3% higher in the regular trading session, were recently up 10.7% to $31.10 in after-hours trading.

Salesforce, like many tech stocks, has seen half its value evaporate in the past five months amid the economy's retrenchment. In addition, traders have grown warier of the competition that may lie ahead for the company, as rivals


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ramp up Internet-based offerings for business customers.

Despite a 36% rise in sales and marketing expenses, the company was able to boost its fourth-quarter operating profit margin to 5.5% from 4.9% a year earlier.

For its current quarter, Salesforce said it expected to earn about 10 cents to 11 cents a share on revenue of $304 million to $305 million, essentially in line with Wall Street estimates.

For the full year ending in January, the company trimmed its revenue forecast and now expects a top line of $1.3 billion to $1.33 billion. On Nov. 20, the company had forecast $1.35 billion to $1.36 billion.

Wall Street analysts were already ahead of the company, expecting, on average, revenue of $1.33 billion.

Salesforce expects to earn about 54 cents to 55 cents a share for the full year, above analysts' most recent consensus estimate of 50 cents a share.