In the current fiscal year, revenues should be a maximum of 31 billion dollars (31.1 billion euros), said SAP’s rival on Wednesday after the US stock market closed. Three months ago, Salesforce had promised up to $31.8 billion. Experts had expected a higher prognosis.
In the past second quarter, Salesforce increased sales compared to the same period last year by 22 percent to $7.7 billion. However, net income fell year-on-year from $535 million to $68 million, partly due to higher costs and weaker development of strategic investments. In the second half of the year, the group expects considerable burdens – above all due to the strong dollar, which reduces foreign earnings after conversion into US currency.
Barclays lowers Salesforce target to $202 – “Overweight”
British investment bank Barclays has lowered its price target for Salesforce from $218 to $202, but left the rating at overweight. With the figures for the second quarter and the lowered outlook, the software company is reminding investors of the global economic slowdown, analyst Raimo Lenschow wrote in a study published on Thursday. Longer term, Salesforce should outperform its peers thanks to its potential to improve margins from within and its stock buyback program.
Salesforce shares fell 7.07 percent to $167.28 in pre-market NYSE trading.
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