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Wow, I had no idea Salesforce had negative GAAP earnings since inception. I assumed they were making a killing as they are SaaS. I guess they are going the Amaz
by Nicholas_C 11y ago
Wow, I had no idea Salesforce had negative GAAP earnings since inception. I assumed they were making a killing as they are SaaS. I guess they are going the Amazon route and plowing everything back into the company to grow top line.
If this rumor is true I'm guessing MSFT sees the opportunity for some serious cost synergies/reductions. At a $46B market cap that would seem to be a lot though!
- adventured 11y agoSalesforce has amazing gross profit margins as you'd expect (76%), but from day one they've intentionally spent to the max seeking market share. Probably a smart move, given the vast scale of Oracle and SAP, and Oracle's general aggressiveness in trying to corner segments through acquisition to build up a moat around their business. About 50% of their revenue still goes to marketing expenditures. Another big dent in their earnings potential, of course, are the stock options they hand out (which is why Salesforce likes to talk about non-GAAP) - something like $500m to $600m per year now, equivalent to roughly 10% of sales. http://www.businessinsider.com/salesforce-earnings-q1-2014-5 http://www.businessinsider.com/salesforce-earnings-q1-2014-5