Salesforce.com, inc. (NYSE: CRM) stock rose over 5% on May 28th, 2021 (Source: Google finance) as the company posted better than expected results for the first quarter of FY 22.
Subscription and support revenues for the quarter were $5.54 billion, which represents an increase of 21% year-over-year. Professional services and other revenues for the quarter were $0.43 billion, which is an increase of 47% year-over-year. Remaining performance obligation ended the first quarter at approximately $35.0 billion, which is an increase of 19% year-over-year. Current remaining performance obligation ended the first quarter at approximately $17.8 billion, which is a growth of 23% year-over-year, 20% in constant currency.
Moreover, Service Cloud posted another quarter of incredible growth at scale, with Q1 revenue of $1.5 billion growing 20% year-over-year, and Tableau continues to perform well. The outperformance in the quarter was mainly due to higher revenue and expense efficiencies, as well as realized and unrealized gains on the strategic investment portfolio. The company incurred Capex for the quarter of $171 million, leading to generation of free cash flow of $3.1 billion, up 99% year-over-year.
CRM in the first quarter of FY 22 has reported the adjusted earnings per share of $1.21, beating the analysts’ estimates for the adjusted earnings per share of 88 cents, according to Zacks Investment Research. The company had reported the adjusted revenue growth of 23 percent to $5.96 billion in the first quarter of FY 22, beating the analysts’ estimates for revenue of $5.88 billion. Q1 non-GAAP operating margin was 20.2%, largely driven by revenue outperformance and incremental expense efficiency.
For the second quarter ending in August, Salesforce.com expects its per-share earnings to range from 91 cents to 92 cents. The company expects revenue to be in the range of $6.22 billion to $6.23 billion for the fiscal second quarter, while the analysts surveyed by Zacks had expected revenue of $6.14 billion. For Q2 the company expects expect to deliver CRPO growth of approximately 20%.
Salesforce.com expects full-year earnings to be in the range of $3.79 to $3.81 per share, with revenue expected to be in the range of $25.9 billion to $26 billion. The company has also raised the fiscal ’22 non-GAAP operating margin to be 18%, an expansion of 30 basis points year-over-year. This continues to include an expected 160 basis points headwind from Slack and Acumen, continued investment in the core business and the moderate increase of travel in the second half of this year. The company has also raised fiscal ’22 operating cash flow guidance by two points, now expecting 12% to 13% growth year-over-year.