Salesforce Inc. (CRM) exceeded Wall Street’s expectations for revenue and profit in its fiscal second quarter, driven by robust demand for its enterprise cloud products.
The company reported revenue of $9.33 billion, surpassing the consensus estimate of $9.23 billion. Shares of Salesforce rose about 3% in after-hours trading following the announcement.
The strong quarterly performance was also marked by an adjusted profit per share of $2.56, exceeding the anticipated $2.36. The company raised its full-year profit forecast to $10.03 to $10.11 per share, up from the previous projection of $9.86 to $9.94.
Despite these positive results, Salesforce announced that Chief Financial Officer (CFO) Amy Weaver will step down from her role. Weaver, who has served as CFO since 2021, will remain in the position until a successor is named and will then continue as an advisor. The company has yet to identify potential candidates for the CFO role, whether internally or externally.
Salesforce’s revenue grew by 8% year-over-year during the quarter ending July 31, although this represents the slowest growth rate the company has experienced in over a decade. The company expects third-quarter revenue of $9.31 billion to $9.36 billion, falling short of the analyst estimate of $9.41 billion.
The company continues to invest heavily in artificial intelligence, with CEO Marc Benioff highlighting upcoming initiatives such as AgentForce, a new AI-powered feature designed to improve customer interactions. However, some analysts, such as Gil Luria of D.A. Davidson, have expressed concern that AI may distract customers from making long-term commitments.
Salesforce’s second-quarter adjusted operating margin was 33.7%, higher than the expected 32%. Despite the positive earnings report, the company continues to face competitive challenges and a slower-than-expected recovery in cloud spending.
The company has maintained its full-year sales outlook but raised its expectations for operating margins. Salesforce’s share price fell 2% in 2024, while the S&P 500 index rose 17% during the same period.
Reuters, Yahoo Finance and CNBC contributed to this report.
