Salesforce, the cloud-based CRM and commerce software company, raised its annual revenue forecast and announced the acquisition of Vlocity, an enterprise that builds six industry-specific CRMs on top of Salesforce – media, communications, media and insurance, health, energy and utilities, and government and nonprofits. This acquisition is seen by many as the software maker’s expansion plan of cloud-based products after major purchases in the past two years.
However, the strong results were overshadowed by the announcement on Thursday that Salesforce co-CEO Keith Block had stepped down, leaving founder Marc Benioff as the company’s lone CEO. After this news broke out, the shares of Salesforce declined about 2 percent.
Block joined Salesforce in 2013 and he was named as the Chief Operating Officer in 2016 and later got promoted to the position of co-CEO with Benioff in August 2018.
Anurag Rana, an analyst at Bloomberg Intelligence, wrote in a research note that the departure of Keith Block as Salesforce.com CEO dims enthusiasm over a strong 4Q, as he has been critical to successes over the past seven years and leaves a short-term vacuum.
Surge in Marketing and Commerce Cloud software sales
Sales of the Marketing Cloud and Commerce Cloud software suites of Salesforce that include its B2B and retail eCommerce software increased 28 percent year over year to $685 million for the fiscal fourth quarter. Marketing and Commerce Cloud sales increased by 32 percent to $2.51 billion for the full fiscal year.
Commerce Cloud software includes the Demandware retail eCommerce software and the CloudCraze B2B ecommerce software that Salesforce acquired in recent years.
In a statement, the San Francisco-based company said total sales will be as much as $21.1 billion in fiscal 2021. An amount of $20.9 billion was projected by analysts, according to data compiled by Bloomberg.
Benioff and Block have sought to maintain the annual growth rates of more than 25 percent of Salesforce through frequent acquisitions and international expansion. Salesforce, the undisputed leader in customer-relations software for the cloud, is in line to double its revenue in three years, bolstered by snapping up MuleSoft Inc. in 2018 and Tableau Software Inc. in 2019 by the end of the fiscal year.
