Salesforce CEO Marc Benioff, whose company is nearing a $20 billion run rate
Salesforce CEO Marc Benioff, whose company is nearing a $20 billion run rate

Salesforce Shock & Awe: Growth Accelerates as Run Rate Hits $20 Billion

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The scary thing about Salesforce and its record-busting fiscal Q4 is that the company’s growth rate is accelerating. as the company is about to hit a $20-billion annualized run rate.

Yes, acquisitions have played some part in that—but not that much of a role.

The inescapable fact is that over the past five quarters, the company’s rate of growth has risen significantly even as its quarterly revenue has come tantalizingly close to $5 billion. Take a look (and remember that Salesforce’s fiscal quarter ends Jan. 31):

  • FY19 Q4: revenue of $3.6 billion, up 26%
  • FY20 Q1: revenue of $3.74 billion, up 24%
  • FY20 Q2: revenue of $4.0 billion, up 22%
  • FY20 Q3: revenue of $4.5 billion, up 33%
  • FY20 Q4: revenue of $4.85 billion, up 35%

Looking at the 26% growth rate from Q4 a year ago, it’s clearly not a matter of seasonality. And as I mentioned, the additive effect of acquiring Tableau has had an impact. 

But neither Tableau (acquired in August 2019) nor MuleSoft (acquired in May 2018) brought giant revenue numbers into Salesforce. But since joining Salesforce, both companies have become high-growth properties for Marc Benioff.

Looking at those quarterly results listed above, plus Salesforce’s recent decision to raise its guidance for its current fiscal 2021 year, it’s pretty obvious that the company will almost certainly crack through the $5-billion quarterly revenue mark in its fiscal Q2, which will end April 30. 

It would be unreasonable to expect that when that quarter ends, we’ll see a continuation of that rising growth-rate trends for Salesforce: 22% three quarters ago, 33% two quarters ago, and 35% last quarter. 

Then again, when did Marc Benioff ever follow “reasonable” expectations?

Cloud Wars

Top 10 Rankings — Feb. 24, 2020

1. Microsoft — Nadella & Co. show who’s #1: cloud revenue thumps AWS’s by 26%
2. Amazon — My ‘open letter’ to Jassy: don’t behave like predator but talk like pacifist
3. Salesforce — 20-year itch: can Benioff outflank SAP in redefining modern CRM?
4. Google — Up from #6: customer-first culture, grows 53%, new AI-powered solutions
5. SAP — co-CEO Klein shoots down Ellison claim re Oracle nabbing big SAP customer
6. Oracle — Larry Ellison brawling with SAP, Amazon and Salesforce
7. IBM — 5 steps new CEO Arvind Krishna can take to reinvigorate growth potential
8. Workday — Can Bhusri continue to beat SAP & Oracle for huge Fortune 100 deals?
9. ServiceNow — Can McDermott be king-maker in Salesforce-SAP battle for CRM?
10. TBD — New addition coming soon!

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