Salesforce, a well-known cloud software company, shared its financial results for the fourth quarter of its fiscal year, but the results weren’t as good as what experts were hoping for. As a result, the company’s stock price dropped during after-hours trading on Wednesday.
In the fourth quarter, Salesforce reported that its revenue reached $9.99 billion, which is an increase of 8% compared to the same period last year. However, this figure was slightly below what analysts from Visible Alpha had predicted. Moreover, the company’s adjusted earnings per share (EPS) for the quarter was $1.75, which shows a small increase from last year’s $1.74. Yet, this also missed the expectations set by analysts.
Looking ahead, Salesforce is predicting that for the next fiscal year, which is 2026, it will earn between $40.5 billion and $40.9 billion in revenue. The company also expects to generate an adjusted EPS ranging from $11.09 to $11.17. These forecasts are below what analysts expected, which was a revenue of $41.32 billion and an EPS of $11.19.
This news comes shortly after Salesforce announced that Robin Washington, who previously served as the Chief Financial Officer at Gilead Sciences, will be joining the company as their chief operating and financial officer starting March 21.
Following the financial news, shares of Salesforce fell by around 5% in after-hours trading on Wednesday. Since the beginning of the year, the company’s stock has decreased by about 8% by the time the market closed.
In summary, while Salesforce did see growth in revenue, they did not meet the expectations of analysts, causing a negative reaction in the stock market. The company’s upcoming leadership changes with the addition of Robin Washington may bring new strategies in the future, but for now, investors are reacting cautiously.