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An impressive financial performance for Q4 and fiscal year 2023 pacifies investors’ concerns about the past revenue and income reports at Salesforce.
American software company Salesforce (NYSE: CRM) recorded its best single-day surge since 2020 after it released its Q4 2023 earnings report that crushed predictions. In addition to exceeding expectations, the company also issued a strong forecast for the current quarter and fiscal year 2024. Against predictions of $1.36 per share on adjusted earnings, the software company reported $1.68 per share, 23% more than analysts’ consensus polled by Refinitiv. Also, revenue reached $8.38 billion in fiscal Q4, exceeding the expected $7.99 billion.
According to a press release that detailed the fiscal Q4 performance, which ended on January 31, Salesforce’s revenue grew 18% YoY to $31.4 billion. The company ended its fiscal year 2023 with an operating cash flow of $7.1 billion, representing a 19% growth YoY. Salesforce said the operating cash is the highest cash flow in its history and also “one of the highest cash flows of any enterprise software company our size.”
Salesforce Records Highest Single-Day Surge since August 26, 2020
The President and Chief Financial Officer at Salesforce, Amy Weaver, spoke about the earnings report that led to the biggest single-day surge since August 2020. She stated:
“Our relentless focus on execution and proactive management of the current environment allowed us to close out a strong quarter and set us up for a transformational fiscal year 24. It’s a New Day at Salesforce and as we look ahead, I am excited for the opportunity in front of us as we continue to drive profitable growth.”
An impressive financial performance for Q4 and fiscal year 2023 pacifies investors’ concerns about the past revenue and income reports at Salesforce. More interestingly, the company executes a 27% adjusted operating margin for the fiscal year 2024. In other words, the cloud-based company’s profitability improvement is two years ahead of schedule.
A recent announcement from Salesforce on the elimination of the board’s committee in charge of mergers and associations triggered commendation from investment management company Elliot Investment Management. Notably, the management firm recently disclosed a stake in Salesforce last month. The software company’s CEO Marc Benioff has been dealing with pressure from activists to boost margins amid slower revenue growth. Shortly after Salesforce released the results that led to its most significant single-day surge in about three years, Elliott Investment Management released a statement. It wrote:
“Salesforce’s set of announcements today represents progress towards regaining investor trust. The steps are consistent with our recommendations, and we believe they will help restore value at Salesforce.”
Goldman Sachs (NYSE: GS) analyst Kash Rangan expressed his satisfaction with the fiscal Q4 report Salesforce published. The analysts increased his 12-month price target for the second time in a week. The latest average price target is $213.03. Meanwhile, Salesforce currently sells at $186.30 in after-hours trading.
After recording its highest single-day surge since 2020, Salesforce stock is trading down 0.14% in extended hours. The company has been consistently amassing gains since the beginning of the year, growing more than 40.73%.