Global CIO: Salesforce.com Rides Chatter Momentum Toward $2 Billion - InformationWeek

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2/7/2011
11:51 AM
Bob Evans
Bob Evans
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Global CIO: Salesforce.com Rides Chatter Momentum Toward $2 Billion

Salesforce's expanding product set and soaring enterprise sales make it the most influential cloud-software company in the world.

Salesforce.com's fiscal fourth-quarter revenue will top $450 million and its torrid 25% annual growth rate will continue this year on the strength of the company's "ever-expanding cloud portfolio," a leading software analyst said in a research note Sunday.

That bullish projection from UBS research director Brent Thill is the latest addition to the remarkable momentum and buzz surrounding Salesforce.com over the past few months as a wave of new products, greater acceptance among large enterprises, and the recruitment of an IBM sales executive to further expand large-company penetration are combining to push this leading cloud-software provider to the brink of a $2 billion revenue run rate.

"We believe CRM (Salesforce.com's stock symbol) will deliver FQ4 revenues above guidance and consensus as strength was driven by strong year-end buying/budget flush, momentum drafting off early December user conference, increased penetration of large enterprises (including new logos), lower churn, and broadening acceptance of Cloud-based apps," wrote Thill.

The company's new social collaboration tool, Chatter, isn't yet a revenue driver itself but it's impact has been extensive, notes Thill: "Chatter has been highly successful as 'server pings' went from <1% of transactions in October '10 to >13% in January '11."

For Salesforce.com, that type of interaction is essential for Chatter as it joins several competitors seeking to capitalize on the social-networking phenomenon to provide an enterprise-strength version that will significantly change how knowledge workers find information, consume applications and resultant findings, and communicate with colleagues, customers, and partners.

More broadly, the range and volume of interactions and transactions that Salesforce is managing for its 87,200 customers is expanding, Thill said, which is a clear indication that the company's cloud-based applications and platform are burrowing more deeply inside mission-critical processes for corporations.

"Daily transaction volume hit record levels last week," Thill wrote, "and are sustaining year-to-year percentage growth rates in the high 70s."

In concert with that more-extensive use of its products, Salesforce.com has also begun changing and expanding the way it describes itself to the world in an effort to change the perception that it's a one-trick pony that does cloud-based CRM and little else.

Here's the company's latest version of its "About salesforce.com" description:

We welcome your comments on this topic on our social media channels, or [contact us directly] with questions about the site.
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