Salesforce posts 20% rise in profits Q2 2009 $21.2M

Salesforce CEO Mark Benioff

Salesforce CEO Mark Benioff

The CRM software provider has just posted strong second quarter financial results.

The company had a 20-percent increase in Q2 2009 (ended July 31) total revenue of $316.1 million compared to the same period last year.

Net income was up a significantly by 112-percent to $21.2 million, despite the fact that companies are spending less to curb costs during this tuff economic time.

Salesforce CEO Marc Benioff said that competition is intensifying between major rivals including Microsoft and Oracle, but the company is still fairing well and continues to win contracts over its major competitors.

 Benioff also said that Salesforce is not seeing as much competition from SAP as the company was not involved in as many competitive bids for contracts.

One of the most recent major contract wins for Salesforce came from Marsh Inc., where the subscriber base could grow to more than 10,000 people (2,500 subscribers have been set for now).

Benioff said, “We added 3,900 net new customers, bringing our total to more than 63,000, with our Service Cloud turning in its best quarter ever.”

Salesforce prices its services more aggressively than its major competitors including both Microsoft and Oracle, and Benioff recognizes this could be a threat if the company is going to sustain its impressive growth.

Benioff also said the company would need to diversify into other areas beyond CRM and sales tracking such as calls centers for the company to continue its growth.

Other current Salesforce customers include Capital One, Reuters, Comcast, Qualcomm, Siemens, Starbucks, Dell, among others.

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Peggy holds a Bachelor Arts degree with honors in Economics from York University in Toronto, Canada. She is a Certified Management Accountant (CMA). She has also passed Level I of the Chartered Financial Analyst (CFA) Program. She is also a realtor. Write to [email protected]
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