Salesforce.com’s Growth - CRM HELPDESK SOFTWARE

Last week’s Announcement of Salesforce.com first quarter’s results revealed an annual revenue forecast of better than $2b for 2011. Very good.

However, the numbers below the top line reveal that Salesforce.com’s prior accelerated growth rate is tamed. Should we be sad about it?

We think not. Prior-year growth figures were in the order of a mega 80%, while the current year-over-year growth rate is 34%. This is not meager but stupendous, given that Salesforce.com is growing from a larger asset base and given the overall CRM market is not enjoying such a lavish growth figure.

Growth Drivers

Salesforce.com’s earlier growth came to a great degree from additional sales. At present, its growth of an additional $125 million is partly fueled by the acquisition of complementary companies.

These acquisitions both fill holes in Salesforce.com’s CRM offering as well as fast-track Salesforce.com’s entry into adjacent markets. Last month’s acquisition of Radian6 is a case in point.

Salesforce.com At A Glance

Fiscal First Quarter Results

First Enterprise Cloud Computing Company to Exceed $2.0 Billion Annual Revenue Run Rate

Record Quarterly Revenue of $504 Million, up 34% Year-Over-Year
Deferred Revenue of $915 Million, up 38% Year-Over-Year
Operating Cash Flow of $140 Million, down 3% Year-Over-Year
5,400 Net New Customers in the Quarter
Total Customers at 97,700 up 26% Year-Over-Year
Raises FY12 Revenue Guidance to $2.15-$2.17 Billion

The acquisition of this social intelligence firm could accelerate Salesforce.com’s dominance in the social and socialCRM and platform markets. This acquisition complements its continuous releases of new products for adjacent markets.

The acquisition of Radian6 in particular extends the value of Salesforce.com’s existing products like Sales Cloud, Service Cloud, Chatter and Force.com.