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Salesforce.com Announces Fiscal 2013 Fourth Quarter and Full Year Results
Submitted by admin on 2/28/2013 @ 1:05 PM
Companies mentioned in this article:
Salesforce.com
SAN FRANCISCO, Feb. 28, 2013 /PRNewswire/ -- Salesforce.com (NYSE: CRM), the enterprise cloud computing (http://www.salesforce.com/cloudcomputing/) company, today announced results for its fiscal fourth quarter and full fiscal year ended January 31, 2013.
(Logo: http://photos.prnewswire.com/prnh/20050216/SFW105LOGO)
"Salesforce.com had a spectacular finish to its fiscal year. We delivered more than $3 billion in revenue and constant currency revenue growth of 37%," said Marc Benioff, Chairman and CEO, salesforce.com. "Salesforce.com continues to be the fastest growing top ten enterprise software company in the world."
Salesforce.com delivered the following results for its fiscal fourth quarter and full fiscal year 2013:
Revenue: Total Q4 revenue was $835 million, an increase of 32% on a year-over-year basis. Subscription and support revenues were $785 million, an increase of 32% on a year-over-year basis. Professional services and other revenues were $49 million, an increase of 31% on a year-over-year basis.
For the full fiscal year 2013, the company reported revenue of $3.05 billion, an increase of 35% from the prior year. Subscription and support revenues were $2.87 billion, an increase of 35% on a year-over-year basis. Professional services and other revenues were $181 million, an increase of 29% on a year-over-year basis.
Earnings per Share: Q4 GAAP net loss per share was ($0.14), and non-GAAP diluted earnings per share was $0.51. The company's non-GAAP results exclude the effects of $108 million in stock-based compensation expense, $21 million in amortization of purchased intangibles, and $6 million in net non-cash interest expense related to the company's convertible senior notes, and is based on a non-GAAP tax rate of approximately 29%. GAAP EPS calculations are based on a basic share count of approximately 145 million shares. Non-GAAP EPS calculations are based on approximately 153 million diluted shares outstanding during the quarter, including approximately five million shares associated with the company's convertible senior notes.
For the full fiscal year 2013, GAAP net loss per share was ($1.92), and non-GAAP diluted earnings per share was $1.63. The company's non-GAAP results exclude the effects of $379 million in stock-based compensation, $149 million related to the one-time tax valuation allowance established in the fiscal third quarter, $88 million in amortization of purchased intangibles, and $24 million in net non-cash interest expense related to the convertible senior notes, and is based on a non-GAAP tax rate of approximately 33%. GAAP EPS calculations are based on a basic share count of approximately 141 million shares. Non-GAAP EPS calculations are based on approximately 149 million diluted shares outstanding during the year, including approximately four million shares associated with the company's convertible senior notes.
Cash: Cash generated from operations for the fiscal fourth quarter was $282 million, an increase of 17% on a year-over-year basis. For the full fiscal year 2013, operating cash flow totaled $737 million, up 25% year-over-year. Total cash, cash equivalents and marketable securities finished the quarter at $1.8 billion.
Deferred Revenue: Deferred revenue on the balance sheet as of January 31, 2013 was $1.86 billion, an increase of 35% on a year-over-year basis. Current deferred revenue increased by 39% year-over-year to $1.80 billion, benefited in part by longer invoice durations. Non-current deferred revenue decreased by 27% year-over-year to $64 million. Unbilled deferred revenue, representing business that is contracted but unbilled and off balance sheet, ended the fourth quarter at approximately $3.5 billion, up from approximately $2.2 billion at the end of the fiscal 2012.
As of February 28, 2013, salesforce.com is initiating revenue and EPS guidance for its first quarter of fiscal year 2014, and initiating EPS guidance for its full fiscal year 2014. In addition, the company is raising its full fiscal year 2014 revenue guidance previously provided on November 20, 2012.
Q1 FY14 Guidance: Revenue for the company's first fiscal quarter is projected to be in the range of $882 million to $887 million, an increase of 27% to 28% year-over-year.
GAAP net loss per share is expected to be in the range of ($0.44) to ($0.42), while diluted non-GAAP EPS is expected to be in the range of $0.40 to $0.42. The non-GAAP estimate excludes the effects of stock-based compensation expense, expected to be approximately $113 million, amortization of purchased intangibles related to acquisitions, expected to be approximately $24 million, and net non-cash interest expense related to the convertible senior notes, expected to be approximately $7 million. EPS estimates assume a GAAP tax rate of approximately negative 59%, which reflects the estimated quarterly change in the tax valuation allowance, and a non-GAAP tax rate of approximately 35%. The GAAP EPS calculation assumes an average basic share count of approximately 147 million shares, and the non-GAAP EPS calculation assumes an average fully diluted share count of approximately 158 million shares.
Full Year FY14 Guidance: Revenue for the company's full fiscal year 2014 is projected to be in the range of $3.82 billion to $3.87 billion, an increase of 25% to 27% year-over-year.
For the company's full fiscal year 2014, GAAP net loss per share is expected to be in the range of ($1.22) to ($1.18) while diluted non-GAAP EPS is expected to be in the range of $1.93 to $1.97. The non-GAAP estimate excludes the effects of stock-based compensation expense, expected to be approximately $503 million, amortization of purchased intangibles related to acquisitions, expected to be approximately $85 million, and net non-cash interest expense related to the convertible senior notes, expected to be approximately $27 million. EPS estimates assume a GAAP tax rate of approximately negative 54%, which reflects the estimated annual change in the tax valuation allowance, and a non-GAAP tax rate of approximately 35%. Due to the tax valuation allowance, however, the GAAP tax rate could be volatile and is therefore difficult to forecast. The GAAP EPS calculation assumes an average basic share count of approximately 150 million shares, and the non-GAAP EPS calculation assumes an average fully diluted share count of approximately 161 million shares.
The following is a per share reconciliation of GAAP EPS to non-GAAP diluted EPS guidance for the first quarter and full fiscal year:
Fiscal 2014
-----------
Q1 FY2014
--- ------
GAAP EPS Range* ($0.44) - ($0.42) ($1.22) - ($1.18)
Plus
Amortization of purchased
intangibles $0.15 $0.53
Stock-based expense $0.71 $3.13
Amortization of debt discount,
net $0.04 $0.17
Less
Income tax adjustments** $(0.06) $(0.68)
------ ------
Non-GAAP diluted EPS $0.40 - $0.42 $1.93 - $1.97
Shares used in computing basic
net income per share
(millions) 147 150
Shares used in computing
diluted net income per share
(millions) 158 161
* For Q1 & FY14 GAAP EPS loss,
basic number of shares used
for calculation
** The company's non-GAAP tax
provision excludes the tax
effects of expense items
described above and certain
tax items not directly related
to the current fiscal year's
ordinary operating results.
Examples of such tax items
include, but are not limited
to, changes in the valuation
allowance related to deferred
tax assets, certain
acquisition-related costs and
unusual or infrequently
occurring items.
Quarterly Conference Call
Salesforce.com will host a conference call to discuss its fourth quarter and full fiscal year 2013 results at 2:00 p.m. Pacific Time today. A live audio webcast of the conference call, together with detailed financial information, can be accessed through the company's Investor Relations Web site at http://www.salesforce.com/investor. In addition, an archive of the audiocast can be accessed through the same link. Participants who choose to call in to the conference call can do so by dialing domestically 866-901-SFDC or 866-901-7332 and internationally at +1 706-902-1764, passcode 94902754. A replay will be available at 800-585-8367 or +1 855-859-2056, passcode 94902754, until midnight (Eastern Time) March 28, 2013.
About salesforce.com
Founded in 1999, salesforce.com is the enterprise cloud computing leader. Salesforce.com's social and mobile cloud technologies enable companies to transform into customer companies by connecting with their customers, employees, partners and products in entirely new ways. Based on salesforce.com's real-time, multitenant architecture, the company's apps and platform revolutionize the way companies sell, service, market and innovate.
-- Grow your business with the #1 sales app, Salesforce Sales Cloud
-- Deliver amazing customer service with the #1 service app, Salesforce
Service Cloud
-- Listen, engage, advertise and measure social marketing with the #1
social marketing app, Salesforce Marketing Cloud
-- Build and deliver social and mobile apps with the Salesforce Platform,
and extend success with the world's leading enterprise app marketplace,
the AppExchange
Any unreleased services or features referenced in this or other press releases or public statements are not currently available and may not be delivered on time or at all. Customers who purchase salesforce.com applications should make their purchase decisions based upon features that are currently available. Salesforce.com has headquarters in San Francisco, with offices in Europe and Asia, and trades on the New York Stock Exchange under the ticker symbol "CRM." For more information please visit http://salesforce.com, or call 1-800-NO-SOFTWARE
Non-GAAP Financial Measures: This press release includes information about non-GAAP EPS and non-GAAP tax rates (collectively the "non-GAAP financial measures"). Non-GAAP EPS estimates exclude the impact of the following non-cash items: stock-based compensation, amortization of acquisition-related intangibles, and the net amortization of debt discount on the company's convertible senior notes, as well as certain one-time, non-cash tax charges and other income tax adjustments. The purpose of the non-GAAP tax rate is to quantify the excluded tax adjustments and the tax consequences associated with the above excluded non-cash expense items. These non-GAAP estimates are not measurements of financial performance prepared in accordance with U.S. generally accepted accounting principles. The method used to produce non-GAAP financial measures is not computed according to GAAP and may differ from the methods used by other companies. Non-GAAP financial measures are not meant to be considered in isolation or as a substitute for comparable GAAP measures and should be read only in conjunction with the company's consolidated financial statements prepared in accordance with GAAP.
The primary purpose of these non-GAAP measures is to provide supplemental information that may prove useful to investors who wish to consider the impact of certain non-cash items on the company's operating performance. Non-cash stock-based compensation, amortization of acquisition-related intangible assets, and the net amortization of debt discount on the company's convertible senior notes are being excluded from the company's FY13 and FY14 financial results because the decisions which gave rise to these expenses were not made to increase revenue in a particular period, but were made for the company's long-term benefit over multiple periods. While strategic decisions, such as those to issue stock-based compensation, acquire a company, or issue convertible senior notes, are made to further the company's long-term strategic objectives and impact the company's statement of operations under GAAP measures, these items affect multiple periods and management is not able to change or affect these items in any particular period. As such, supplementing GAAP disclosure with non-GAAP disclosure using the non-GAAP measures provides management with an additional view of operational performance by excluding expenses that are not directly related to performance in any particular period, and management uses both GAAP and non-GAAP measures when planning, monitoring, and evaluating the company's performance.
In addition, the majority of the company's industry peers report non-GAAP operating results that exclude certain non-cash or non-recurring items, such as certain one-time charges. As significant unusual or discrete events occur, such as the valuation allowance against the company's deferred tax assets, the results may be excluded in the period in which the events occur. Management believes that the provision of supplemental non-GAAP information will enable a more complete comparison of the company's relative performance.
Specifically, management is excluding the following items from its non-GAAP EPS for Q4 and FY13 and its non-GAAP estimates for Q1 and FY14:
-- Stock-Based Expenses: The company's compensation strategy includes the
use of stock-based compensation to attract and retain employees and
executives. It is principally aimed at aligning their interests with
those of our stockholders and at long-term employee retention, rather
than to motivate or reward operational performance for any particular
period. Thus, stock-based compensation expense varies for reasons that
are generally unrelated to operational decisions and performance in any
particular period.
-- Amortization of Purchased Intangibles: The company views amortization
of acquisition-related intangible assets, such as the amortization of
the cost associated with an acquired company's research and development
efforts, trade names, customer lists and customer relationships, as
items arising from pre-acquisition activities determined at the time of
an acquisition. While these intangible assets are continually evaluated
for impairment, amortization of the cost of purchased intangibles is a
static expense, one that is not typically affected by operations during
any particular period.
-- Amortization of Debt Discount: Under GAAP, certain convertible debt
instruments that may be settled in cash (or other assets) on conversion
are required to be separately accounted for as liability (debt) and
equity (conversion option) components of the instrument in a manner that
reflects the issuer's non-convertible debt borrowing rate. Accordingly,
for GAAP purposes we are required to recognize imputed interest expense
on the company's $575 million of convertible senior notes that were
issued in a private placement in January 2010. The imputed interest
rate is approximately 5.9%, while the actual coupon interest rate of the
notes is 0.75%. The difference between the imputed interest expense and
the coupon interest expense, net of the interest amount capitalized, is
excluded from management's assessment of the company's operating
performance because management believes that this non-cash expense is
not indicative of ongoing operating performance. Management believes
that the exclusion of the non-cash interest expense provides investors
an enhanced view of the company's operational performance.
-- One-time Tax Charge: As a result of the company assessing the
realizability of its deferred tax assets, in the fiscal third quarter
the company recorded a one-time, non-cash charge to income tax expense
to establish a valuation allowance against a significant portion of
those assets. The company applied significant judgment as part of this
analysis including considering the company's past operating results,
cumulative losses and forecasts of future taxable income. As part of
establishing a valuation allowance with respect to the company's
deferred tax assets, the company will assess and record any necessary
quarterly changes to the valuation allowance and the corresponding
income tax expense or benefit. Management believes that the exclusion
of this non-cash charge is appropriate to provide investors with a
better view of the company's operational performance.
-- Income Tax Effects and Adjustments: The company's non-GAAP tax provision
excludes the tax effects of expense items described above and certain
tax items not directly related to the current fiscal year's ordinary
operating results. Examples of such tax items include, but are not
limited to, changes in the valuation allowance related to deferred tax
assets, certain acquisition-related costs and unusual or infrequently
occurring items. Management believes the exclusion of these income tax
adjustments provides investors with useful supplemental information
about the company's operational performance
"Safe harbor" statement under the Private Securities Litigation Reform Act of 1995: This press release contains forward-looking statements about expected GAAP and non-GAAP financial results for the first fiscal quarter and the full fiscal year of 2014, including revenue, net loss, EPS, expected revenue run rate, expected tax rates, stock-based compensation expenses, amortization of purchased intangibles and debt discount, non-cash interest expense, shares outstanding, and deferred tax asset valuation allowances. The achievement or success of the matters covered by such forward-looking statements involves risks, uncertainties and assumptions. If any such risks or uncertainties materialize or if any of the assumptions prove incorrect, the company's results could differ materially from the results expressed or implied by the forward-looking statements we make.
The risks and uncertainties referred to above include - but are not limited to - risks associated with possible fluctuations in the company's financial and operating results; the company's rate of growth and anticipated revenue run rate, including the company's ability to convert deferred revenue and unbilled deferred revenue into revenue and, as appropriate, cash flow, and the continued growth and ability to maintain deferred revenue and unbilled deferred revenue; errors, interruptions or delays in the company's service or the company's Web hosting; breaches of the company's security measures; the financial impact of any previous and future acquisitions; the nature of the company's business model; the company's ability to continue to release, and gain customer acceptance of, new and improved versions of the company's service; successful customer deployment and utilization of the company's existing and future services; changes in the company's sales cycle; competition; various financial aspects of the company's subscription model; unexpected increases in attrition or decreases in new business; the emerging markets in which the company operates; unique aspects of entering or expanding in international markets, the company's ability to hire, retain and motivate employees and manage the company's growth; changes in the company's customer base; technological developments; regulatory developments; litigation related to intellectual property and other matters, and any related claims, negotiations and settlements; unanticipated changes in the company's effective tax rate; fluctuations in the number of shares we have outstanding and the price of such shares; foreign currency exchange rates; collection of receivables; interest rates; factors affecting our deferred tax assets and ability to value and utilize them, including the timing of when we once again achieve profitability on a pre-tax basis; the risks and expenses associated with the company's real estate and office facilities space; and general developments in the economy, financial markets, and credit markets.
Further information on these and other factors that could affect the company's financial results is included in the reports on Forms 10-K, 10-Q and 8-K and in other filings we make with the Securities and Exchange Commission from time to time, including the company's Form 10-K that will be filed for the fiscal year ended January 31, 2013. These documents are available on the SEC Filings section of the Investor Information section of the company's website at www.salesforce.com/investor.
Salesforce.com, inc. assumes no obligation and does not intend to update these forward-looking statements, except as required by law.
© 2013 salesforce.com, inc. All rights reserved. Salesforce, Sales Cloud, Service Cloud, Marketing Cloud, AppExchange, Salesforce Platform, and others are trademarks of salesforce.com, inc. Other brands featured herein may be trademarks of their respective owners.
salesforce.com, inc.
Condensed Consolidated Statements of Operations
(in thousands, except per share data)
(Unaudited)
Three Months Ended Fiscal Year Ended
January 31, January 31,
----------- -----------
2013 2012 2013 2012
---- ---- ---- ----
Revenues:
Subscription and
support $785,495 $594,269 $2,868,808 $2,126,234
Professional
services and other 49,186 37,644 181,387 140,305
-----------
Total revenues 834,681 631,913 3,050,195 2,266,539
Cost of revenues (1)(2):
Subscription and
support 132,741 100,065 494,187 360,758
Professional
services and other 50,621 36,280 189,392 128,128
-----------
Total cost of
revenues 183,362 136,345 683,579 488,886
Gross profit 651,319 495,568 2,366,616 1,777,653
Operating expenses (1)(2):
Research and
development 121,187 80,613 429,479 295,347
Marketing and sales 435,570 327,567 1,614,026 1,169,610
General and
administrative 115,369 93,765 433,821 347,781
-----------
Total
operating
expenses 672,126 501,945 2,477,326 1,812,738
Loss from operations (20,807) (6,377) (110,710) (35,085)
Investment income 4,041 4,965 19,562 23,268
Interest expense (8,355) (5,669) (30,948) (17,045)
Other income (expense) (922) (454) (5,698) (4,455)
---- ---- ------ ------
Loss before benefit from (provision for) income taxes (26,043) (7,535) (127,794) (33,317)
Benefit from (provision for) income taxes 5,199 3,457 (142,651) 21,745
----- ----- -------- ------
Net loss $(20,844) $(4,078) $(270,445) $(11,572)
======== ======= ========= ========
Basic net loss per share $(0.14) $(0.03) $(1.92) $(0.09)
Diluted net loss per share $(0.14) $(0.03) $(1.92) $(0.09)
Shares used in computing basic net loss per share 144,970 136,720 141,224 135,302
Shares used in computing diluted net loss per share 144,970 136,720 141,224 135,302
(1) Amounts include amortization of purchased intangibles
from business combinations, as follows:
Cost of
revenues $18,886 $17,132 $77,249 $60,069
Marketing and
sales 2,093 2,751 10,922 7,250
(2) Amounts include stock-based expenses, as follows:
Cost of
revenues $9,304 $5,283 $33,757 $17,451
Research and
development 22,593 14,670 76,333 45,894
Marketing and
sales 57,212 35,706 199,284 115,730
General and
administrative 18,446 14,441 69,976 50,183
salesforce.com, inc.
Condensed Consolidated Statements of Operations
As a percentage of total revenues:
(Unaudited)
Three Months Ended Fiscal Year Ended
January 31, January 31,
------------------- ------------------
2013 2012 2013 2012
---- ---- ---- ----
Revenues:
Subscription and
support 94% 94% 94% 94%
Professional
services and
other 6 6 6 6
--------
Total revenues 100 100 100 100
Cost of revenues (1)(2):
Subscription and
support 16 16 16 16
Professional
services and
other 6 6 6 6
--------
Total cost of revenues 22 22 22 22
Gross profit 78 78 78 78
Operating expenses (1)(2):
Research and
development 14 12 14 13
Marketing and
sales 52 52 53 52
General and
administrative 14 15 15 15
--------
Total operating expenses 80 79 82 80
Loss from operations (2) (1) (4) (2)
Investment income 0 1 1 1
Interest expense (1) (1) (1) (1)
Other income (expense) 0 0 0 0
--- --- --- ---
Loss before benefit from (provision for) income taxes (3) (1) (4) (2)
Benefit from (provision for) income taxes 1 0 (5) 1
--- --- --- ---
Net loss (2)% (1)% (9)% (1)%
=== === === ===
(1) Amortization of purchased intangibles from business combinations as a
percentage of total revenues, as follows:
Cost of revenues 2% 3% 3% 3%
Marketing and sales 0 0 0 0
(2) Stock-based expenses as a percentage of total revenues, as follows:
Cost of revenues 1% 1% 1% 1%
Research and development 3 2 3 2
Marketing and sales 7 6 7 5
General and administrative 2 2 2 2
salesforce.com, inc.
Condensed Consolidated Balance Sheets
(in thousands)
January 31, January 31,
2013 2012
---- ----
(unaudited)
Assets
Current assets:
Cash and cash
equivalents $747,245 $607,284
Short-term
marketable
securities 120,376 170,582
Accounts
receivable,
net 872,634 683,745
Deferred
commissions 142,311 98,471
Deferred income
taxes, net 7,321 31,821
Prepaid
expenses and
other current
assets (see
additional
metrics) 125,993 80,319
-------
Total current assets 2,015,880 1,672,222
Marketable securities, noncurrent 890,664 669,308
Property and equipment, net (see
additional metrics) 604,669 527,946
Deferred commissions, noncurrent 112,082 78,149
Deferred income taxes, noncurrent,
net 19,212 87,587
Capitalized software, net (see
additional metrics) 207,323 188,412
Goodwill 1,529,378 785,381
Other assets, net (see additional
metrics) 149,748 155,149
------- -------
Total assets $5,528,956 $4,164,154
========== ==========
Liabilities, temporary equity and stockholders' equity
Current liabilities:
Accounts
payable,
accrued
expenses and
other
liabilities
(see
additional
metrics) $597,706 $512,260
Deferred
revenue 1,798,640 1,291,622
Convertible
senior notes,
net 521,278 496,149
-------
Total current liabilities 2,917,624 2,300,031
Income taxes payable, noncurrent 49,074 37,258
Long-term lease liabilities and
other 126,658 72,091
Deferred revenue, noncurrent 64,355 88,673
------ ------
Total liabilities 3,157,711 2,498,053
--------- ---------
Temporary equity 53,612 78,741
------ ------
Stockholders' equity:
Common stock 146 137
Additional
paid-in
capital 2,411,332 1,415,077
Accumulated
other
comprehensive
income 17,137 12,683
Retained
earnings
(accumulated
deficit) (110,982) 159,463
---------
Total stockholders' equity 2,317,633 1,587,360
--------- ---------
Total liabilities, temporary equity
and stockholders' equity $5,528,956 $4,164,154
========== ==========
salesforce.com, inc.
Condensed Consolidated Statements of Cash Flows
(in thousands)
(Unaudited)
Three Months Ended January
31, Fiscal Year Ended
January 31,
-----------
2013 2012 2013 2012
---- ---- ---- ----
Operating activities:
Net loss $(20,844) $(4,078) $(270,445) $(11,572)
Adjustments to reconcile net loss to net
cash provided by operating activities:
Depreciation and
amortization 57,395 45,901 216,795 157,286
Amortization of
debt discount
and transaction
costs 6,575 3,877 24,086 10,347
Amortization of
deferred
commissions 43,719 30,742 154,818 107,195
Expenses related
to employee
stock plans 107,555 70,100 379,350 229,258
Excess tax
benefits from
employee stock
plans 13,972 4,994 (14,933) (6,018)
Changes in assets
and liabilities,
net of business
combinations:
Accounts receivable, net (454,044) (365,099) (183,242) (244,947)
Deferred commissions (117,000) (86,947) (232,591) (167,199)
Prepaid expenses and other current
assets (4,134) (777) (20,840) (10,736)
Other assets 3,483 2,816 11,122 2,883
Accounts payable, accrued expenses,
deferred income taxes and other
liabilities 73,604 76,344 193,358 80,336
Deferred revenue 571,292 462,474 479,419 444,674
------- ------- ------- -------
Net cash provided by operating
activities 281,573 240,347 736,897 591,507
------- ------- ------- -------
Investing activities:
Business combinations, net of cash acquired (4,994) (57,914) (579,745) (422,699)
Land activity and building improvements 0 (6,565) (4,106) (19,655)
Strategic investments (4,244) (2,647) (9,695) (37,370)
Changes in marketable securities (118,558) (45,608) (169,771) 141,679
Capital expenditures (50,522) (44,602) (175,601) (151,645)
------- ------- -------- --------
Net cash used in investing
activities (178,318) (157,336) (938,918) (489,690)
-------- -------- -------- --------
Financing activities:
Proceeds from employee stock plans 147,492 26,203 351,366 116,565
Excess tax benefits from employee stock plans (13,972) (4,994) 14,933 6,018
Contingent consideration payment related to prior
business combinations 0 0 0 (16,200)
Principal payments on capital lease obligations (9,037) (8,737) (31,754) (30,533)
------ ------ ------- -------
Net cash provided by financing
activities 124,483 12,472 334,545 75,850
------- ------ ------- ------
Effect of exchange rate changes (2,213) 8,814 7,437 5,325
------ ----- ----- -----
Net increase in cash and cash equivalents 225,525 104,297 139,961 182,992
Cash and cash equivalents, beginning of period 521,720 502,987 607,284 424,292
------- ------- ------- -------
Cash and cash equivalents, end of period $747,245 $607,284 $747,245 $607,284
======== ======== ======== ========
salesforce.com, inc.
Additional Metrics
(Unaudited)
Jan 31, Oct 31, Jul 31, Apr 30, Jan 31, Oct 31,
2013 2012 2012 2012 2012 2011
---- ---- ---- ---- ---- ----
Full Time Equivalent Headcount 9,801 9,319 8,765 8,335 7,785 6,953
Financial data (in thousands):
Cash, cash equivalents and marketable
securities $1,758,285 $1,416,050 $1,804,265 $1,657,089 $1,447,174 $1,296,693
Deferred revenue, current and noncurrent $1,862,995 $1,291,703 $1,337,184 $1,334,716 $1,380,295 $917,821
Selected Balance Sheet Accounts (in thousands):
Jan 31, Oct 31, Jan 31,
2013 2012 2012
---- ---- ----
Prepaid Expenses and Other Current Assets
Deferred professional services costs $3,522 $4,974 $10,399
Prepaid income taxes 21,180 17,526 12,785
Prepaid expenses and other current assets 101,291 95,100 57,135
$125,993 $117,600 $80,319
======== ======== =======
Property and Equipment, net
Land $248,263 $248,263 $248,263
Building improvements 49,572 49,572 43,868
Computers, equipment and software 328,318 305,216 232,460
Furniture and fixtures 38,275 34,093 25,250
Leasehold improvements 193,181 172,569 137,587
--------------
857,609 809,713 687,428
Less accumulated depreciation and
amortization (252,940) (225,874) (159,482)
--------------
$604,669 $583,839 $527,946
======== ======== ========
Capitalized Software, net
Capitalized internal-use software
development costs, net of accumulated
amortization $59,647 $57,866 $41,442
Acquired developed technology, net of
accumulated amortization 147,676 167,271 146,970
--------------
$207,323 $225,137 $188,412
======== ======== ========
Other Assets, net
Deferred professional services costs,
noncurrent portion $1,077 $1,573 $3,935
Long-term deposits 13,422 14,425 13,941
Purchased intangible assets, net of
accumulated amortization 49,354 51,447 46,110
Acquired intellectual property, net of
accumulated amortization 13,872 14,851 15,020
Strategic investments 51,685 50,251 53,949
Other 20,338 21,253 22,194
$149,748 $153,800 $155,149
======== ======== ========
Accounts Payable, Accrued Expenses and
Other Current Liabilities
Accounts payable $14,535 $57,940 $33,258
Accrued compensation 311,595 230,662 228,466
Accrued other liabilities 138,165 142,647 121,957
Accrued income and other taxes payable 120,341 75,468 100,471
Accrued professional costs 10,064 13,044 21,993
Accrued rent 3,006 9,154 6,115
$597,706 $528,915 $512,260
======== ======== ========
Selected Off-Balance Sheet Accounts
Unbilled Deferred Revenue, a non-GAAP measure
Unbilled deferred revenue was approximately $3.5 billion as of January 31, 2013,
$3.0 billion as of October 31, 2012 and $2.2 billion as of January 31, 2012.
Unbilled deferred revenue represents future billings under our non-cancelable
subscription agreements that have not been invoiced and, accordingly, are not
recorded in deferred revenue.
Supplemental Revenue Analysis
Three Months Ended Fiscal Year Ended
January 31, January 31,
----------- -----------
2013 2012 2013 2012
---- ---- ---- ----
Revenues by geography (in thousands):
Americas $583,410 $436,237 $2,123,736 $1,540,289
Europe 148,610 108,141 525,304 408,456
Asia Pacific 102,661 87,535 401,155 317,794
------------
$834,681 $631,913 $3,050,195 $2,266,539
======== ======== ========== ==========
As a percentage of total revenues:
Revenues by geography:
Americas 70% 69% 70% 68%
Europe 18 17 17 18
Asia Pacific 12 14 13 14
------------
100% 100% 100% 100%
=== === === ===
Three Months Ended Three Months Ended Three Months Ended
January 31, 2013 October 31, 2012 January 31, 2012
compared to Three Months compared to Three Months compared to Three Months
Ended January 31, 2012 Ended October 31, 2011 Ended January 31, 2011
---------------------- ---------------------- ----------------------
Revenue constant currency growth rates (as compared to the comparable
prior periods)
Americas 34% 38% 41%
Europe 39% 41% 32%
Asia Pacific 22% 30% 28%
Total growth 33% 37% 38%
We present constant currency information to provide a framework for assessing how our underlying business performed excluding the effect of foreign currency rate fluctuations. To present this information, current and comparative prior period results for entities reporting in currencies other than
United States dollars are converted into United States dollars at the exchange rates in effect at the end of each quarter for growth rate calculations presented, rather than the actual exchange rates in effect during that period.
Supplemental Diluted Share Count Information
(in thousands)
Three Months Ended Fiscal Year Ended
January 31, January 31,
----------- -----------
2013 2012 2013 2012
---- ---- ---- ----
Weighted-average shares outstanding for
basic earnings per share 144,970 136,720 141,224 135,302
Effect of dilutive securities (1):
Convertible senior notes 3,179 1,700 2,840 2,263
Warrants associated with the convertible
senior note hedges 1,757 0 1,283 553
Employee stock awards 3,300 3,407 3,723 4,177
Adjusted weighted-average shares
outstanding and assumed conversions for
diluted earnings per share 153,206 141,827 149,070 142,295
==============
(1) The effects of these dilutive securities were not included in the GAAP calculation of diluted net loss per share for the
three and twelve months ended January 31, 2013 and 2012 because the effect would have been anti-dilutive.
Supplemental Cash Flow Information
Free cash flow analysis, a non-GAAP measure
(in thousands)
Three Months Ended Fiscal Year Ended
January 31, January 31,
----------- -----------
2013 2012 2013 2012
---- ---- ---- ----
Operating cash flow
GAAP net cash provided by operating
activities $281,573 $240,347 $736,897 $591,507
Less:
Capital expenditures (50,522) (44,602) (175,601) (151,645)
Free cash flow $231,051 $195,745 $561,296 $439,862
==============
Our free cash flow analysis includes GAAP net cash provided by operating activities less capital expenditures. The capital expenditures balance does not include any costs related to the purchase and activities related to land activity, building improvements and strategic investments.
Comprehensive Income (Loss)
(in thousands) Three Months Ended Fiscal Year Ended
January 31, January 31,
----------- -----------
2013 2012 2013 2012
---- ---- ---- ----
Net loss $(20,844) $(4,078) $(270,445) $(11,572)
Other comprehensive income (loss), before
tax and net of reclassification
adjustments:
Foreign currency translation and other
gains (losses) (5,298) 9,065 4,783 9,512
Unrealized gains (losses) on investments (1,740) (1,042) (329) (5,658)
--------------
Other comprehensive income (loss), before
tax (7,038) 8,023 4,454 3,854
Tax effect 526 683 0 2,110
----------
Other comprehensive income (loss), net
of tax (6,512) 8,706 4,454 5,964
Comprehensive income (loss) $(27,356) $4,628 $(265,991) $(5,608)
==========================
salesforce.com, inc.
GAAP RESULTS RECONCILED TO NON-GAAP RESULTS
The following table reflects selected salesforce.com GAAP results reconciled to non-GAAP results
(in thousands, except per share data)
(Unaudited)
Three Months Ended Fiscal Year Ended
January 31, January 31,
2013 2012 2013 2012
---- ---- ---- ----
Gross profit
------------
GAAP gross profit $651,319 $495,568 $2,366,616 $1,777,653
Plus:
Amortization of purchased
intangibles (a) 18,886 17,132 77,249 60,069
Stock-based expenses (b) 9,304 5,283 33,757 17,451
Non-GAAP gross profit $679,509 $517,983 $2,477,622 $1,855,173
--------
Operating expenses
------------------
GAAP operating expenses $672,126 $501,945 $2,477,326 $1,812,738
Less:
Amortization of purchased
intangibles (a) (2,093) (2,751) (10,922) (7,250)
Stock-based expenses (b) (98,251) (64,817) (345,593) (211,807)
Non-GAAP operating expenses $571,782 $434,377 $2,120,811 $1,593,681
--------
Income from operations
----------------------
GAAP loss from operations $(20,807) $(6,377) $(110,710) $(35,085)
Plus:
Amortization of purchased
intangibles (a) 20,979 19,883 88,171 67,319
Stock-based expenses (b) 107,555 70,100 379,350 229,258
Non-GAAP income from operations $107,727 $83,606 $356,811 $261,492
--------
Non-operating income (loss) (c)
------------------------------
GAAP non-operating income (loss) $(5,236) $(1,158) $(17,084) $1,768
Plus: Amortization of debt
discount, net 6,389 4,144 23,837 12,335
Non-GAAP non-operating income
(loss) $1,153 $2,986 $6,753 $14,103
------
Net income
----------
GAAP net loss $(20,844) $(4,078) $(270,445) $(11,572)
Plus:
Amortization of purchased
intangibles 20,979 19,883 88,171 67,319
Stock-based expenses 107,555 70,100 379,350 229,258
Amortization of debt discount, net 6,389 4,144 23,837 12,335
One-time tax items (e) 0 0 149,147 0
Less:
Income tax effect of Non-GAAP
adjustments (36,347) (28,419) (127,518) (103,730)
Non-GAAP net income $77,732 $61,630 $242,542 $193,610
=======
Diluted earnings per share
--------------------------
GAAP diluted loss per share (d) $(0.14) $(0.03) $(1.92) $(0.09)
Plus:
Amortization of purchased
intangibles 0.14 0.14 0.59 0.47
Stock-based expenses 0.70 0.49 2.54 1.62
Amortization of debt discount, net 0.04 0.03 0.16 0.09
One-time tax items 0.00 0.00 1.00 0.00
Less: .
Income tax effect of Non-GAAP
adjustments (0.23) (0.20) (0.74) (0.73)
Non-GAAP diluted earnings per share $0.51 $0.43 $1.63 $1.36
=====
Shares used in computing diluted
net income per share 153,206 141,827 149,070 142,295
a) Amortization of purchased
intangibles were as follows:
Three Months Ended Fiscal Year Ended
January 31, January 31,
----------- -----------
2013 2012 2013 2012
---- ---- ---- ----
Cost of revenues $18,886 $17,132 $77,249 $60,069
Marketing and sales 2,093 2,751 10,922 7,250
-----
$20,979 $19,883 $88,171 $67,319
======= ======= ======= =======
b) Stock-based expenses were as
follows:
Three Months Ended Fiscal Year Ended
January 31, January 31,
----------- -----------
2013 2012 2013 2012
---- ---- ---- ----
Cost of revenues $9,304 $5,283 $33,757 $17,451
Research and development 22,593 14,670 76,333 45,894
Marketing and sales 57,212 35,706 199,284 115,730
General and administrative 18,446 14,441 69,976 50,183
$107,555 $70,100 $379,350 $229,258
======== ======= ======== ========
c) Non-operating income (loss) consists of investment income, interest
expense and other income (expense).
d) Reported GAAP loss per share was calculated using the basic share
count.
Non-GAAP diluted earnings per share was calculated using the diluted
share count.
(e) One-time, non-cash charge to income tax expense to establish a
valuation allowance against a significant portion of deferred tax
assets which was recorded in the fiscal third quarter 2013.
salesforce.com, inc.
COMPUTATION OF BASIC AND DILUTED GAAP AND NON-GAAP NET INCOME (LOSS) PER SHARE
(in thousands, except
per share data)
(Unaudited)
Three Months Ended Fiscal Year Ended
January 31, January 31,
2013 2012 2013 2012
---- ---- ---- ----
GAAP Basic Net Loss Per
Share
Net loss $(20,844) $(4,078) $(270,445) $(11,572)
Basic net loss per share $(0.14) $(0.03) $(1.92) $(0.09)
Shares used in computing
basic net loss per share 144,970 136,720 141,224 135,302
Three Months Ended Fiscal Year Ended
January 31, January 31,
2013 2012 2013 2012
---- ---- ---- ----
Non-GAAP Basic Net Income
Per Share
Non-GAAP net income $77,732 $61,630 $242,542 $193,610
Basic Non-GAAP net income
per share $0.54 $0.45 $1.72 $1.43
Shares used in computing
basic net income per share 144,970 136,720 141,224 135,302
Three Months Ended Fiscal Year Ended
January 31, January 31,
2013 2012 2013 2012
---- ---- ---- ----
GAAP Diluted Net Loss Per
Share
Net loss $(20,844) $(4,078) $(270,445) $(11,572)
Diluted net loss per share $(0.14) $(0.03) $(1.92) $(0.09)
Shares used in computing
diluted net loss per share 144,970 136,720 141,224 135,302
Three Months Ended Fiscal Year Ended
January 31, January 31,
2013 2012 2013 2012
---- ---- ---- ----
Non-GAAP Diluted Net Income
Per Share
Non-GAAP net income $77,732 $61,630 $242,542 $193,610
Diluted Non-GAAP net income
per share $0.51 $0.43 $1.63 $1.36
Shares used in computing
diluted net income per
share 153,206 141,827 149,070 142,295
SOURCE salesforce.com