Salesforce.com (CRM) on Thursday raised its fiscal 2022 revenue outlook and forecast fiscal 2023 revenue slightly above expectations. CRM stock popped on the updated financial outlook.
The enterprise software maker released the updated outlook ahead of an analyst day coinciding with its Dreamforce user conference.
For fiscal 2022, which ends in December, Salesforce said it expects revenue in a range of $26.25 billion to $26.35 billion. Its earlier guidance was $26 billion at the high end. Salesforce said it expects fiscal 2023 revenue in a range of $31.65 billion to $31.80 billion vs. estimates of $31.52 billion.
Salesforce’s operating margin guidance also came in better-than-expected, said Wolfe Research analyst Alex Zukin in a report.
“We believe that the updated guidance puts free cash flow growth in the 30%-plus territory for fiscal 2023,” said Zukin.
Salesforce on July 21 closed its acquisition of Slack Technologies. Further, analysts expect Salesforce to discuss the Slack integration roadmap at the analyst day.
CRM Stock: Slack Deal Targets Microsoft
Amid growing competition with Microsoft (MSFT), Salesforce paid $27.7 billion for workplace collaboration software maker Slack.
At an investor day on Dec. 8, Salesforce said it aims to double revenue to $50 billion by 2026, including a $4 billion contribution from Slack. At the same time, Salesforce stock lowered its organic revenue growth target to 19% from 20% over the next four years.
Amid several acquisitions, management’s outlook on operating margins has been a key issue for Salesforce stock. As of Wednesday’s market close, CRM stock had gained over 16% in 2021.
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