SAN FRANCISCO (Reuters)-Web business software maker Salesforce.com Inc Wednesday reported a rise in quarterly profit and raised full-year earnings forecasts, boosted by a growing number of customers adopting its online applications.
Shares of Salesforce, whose stock has risen 19 percent since it last reported results on Feb. 27, fell 1 percent in after-hours trade on expectations of a blow-out quarter.
The company reported first-quarter net income of $9.6 million, or 8 cents per share, up from $730,000, or 1 cent per share, in the year-ago period. Revenue rose 52 percent to $247.6 million from $162.4 million a year earlier.
Analysts, on average, had forecast earnings of 7 cents per share on revenue of $235.7 million, according to Reuters Estimates.
Like other Web start-ups, the company is challenging established software companies including SAP AG, Microsoft Corp and Oracle Corp with a new technology model called "cloud computing."
It arrays large numbers of data center computers, enabling them to deliver Web-based applications to far-flung users, while traditional software runs on a user's local hard drive.
Salesforce has already signed major customers including Citigroup Inc and Dell Inc to its online platform of software applications. The company said it increased its customer base by 6 percent in the first quarter.
Rebecca Wettemann, an analyst at Nucleus Research, said results came in as expected but that the company's broad range of customers is a "real validation" of its business model.
Salesforce now sees full-year diluted earnings per share ranging from 33 cents to 34 cents, up from a previous forecast of 32 cents to 33 cents, on revenue of $1.06 billion to $1.07 billion, up from a prior estimate of $1.03 billion to $1.04 billion.
Analysts are forecasting diluted earnings of 34 cents per share on revenue of $1.05 billion, according to Reuters Estimates.
For the current quarter, Salesforce estimated diluted earnings per share of 7 cents to 8 cents on revenue of $258 million to $259 million. Wall Street was looking for diluted EPS of 8 cents on revenue of $250.9 million, according to Reuters Estimates.
Shares of Salesforce fell to $62 in extended trade after closing down 14 cents at $62.66 on the New York Stock Exchange.
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