SAN FRANCISCO, Nov. 21, 2017 /PRNewswire/ -- Salesforce (NYSE:
CRM), the global leader in CRM, today announced results for its
fiscal third quarter ended October 31,
2017.
"Salesforce delivered a record third quarter, and we're on a
path to exceed $20 billion faster
than any enterprise software company in history," said
Marc Benioff, chairman and CEO,
Salesforce. "With this phenomenal growth, we are building a company
for the ages, creating value for our Trailblazers – our
customers, employees, investors and communities – while
helping make the world a better place for decades to
come."
Salesforce delivered the following results for its fiscal third
quarter 2018:
Revenue: Total third
quarter revenue was $2.68 billion, an
increase of 25% year-over-year, and 23% in constant currency.
Subscription and support revenues were $2.49
billion, an increase of 25% year-over-year. Professional
services and other revenues were $194
million, an increase of 20% year-over-year.
Earnings per Share: Third
quarter GAAP diluted earnings per share was $0.07, and non-GAAP diluted earnings per share
was $0.39.
Cash: Cash generated from
operations for the third quarter was $126
million, a decrease of 18% year-over-year. Total cash, cash
equivalents and marketable securities finished the quarter at
$3.63 billion.
Deferred Revenue: Deferred
revenue on the balance sheet as of October
31, 2017 was $4.39 billion, an
increase of 26% year-over-year, and 24% in constant currency.
Unbilled deferred revenue, representing business that is contracted
but unbilled and off balance sheet, ended the third quarter at
approximately $11.5 billion, up 34%
year-over-year.
As of November 21, 2017, the
company is initiating revenue, earnings per share, and deferred
revenue guidance for its fourth quarter of fiscal year 2018. In
addition, the company is raising its full fiscal year 2018 revenue
and earnings per share guidance, and maintaining its operating cash
flow guidance, previously provided on August
22, 2017. The company is also confirming its full fiscal
year 2019 revenue guidance, previously provided on November 6, 2017.
Q4 FY18 Guidance: Revenue
is projected to be $2.801 billion to $2.811
billion, an increase of 22% to 23% year-over-year.
GAAP diluted earnings per share is
projected to be $0.03 to $0.04, while
non-GAAP diluted earnings per share is projected to be $0.32 to $0.33.
On balance sheet deferred revenue
growth is projected to be 19% to 20% year-over-year.
Full Year FY18 Guidance:
Revenue is projected to be $10.43 billion to
$10.44 billion, an increase of 24% year-over-year.
GAAP diluted earnings per share is
projected to be $0.12 to $0.13, while
non-GAAP diluted earnings per share is projected to be $1.32 to $1.33.
Operating cash flow growth is
projected to be 20% to 21% year-over-year.
Full Year FY19
Guidance: Revenue is projected to be $12.45 billion to $12.50 billion, an increase of
19% to 20% year-over-year. The company plans on providing its
expectations for FY19 GAAP EPS, non-GAAP EPS, and operating cash
flow when it announces its fourth quarter and full fiscal year 2018
results in February 2018.
The following is a per share reconciliation of GAAP diluted
earnings per share to non-GAAP diluted earnings per share guidance
for the next quarter and the full year:
|
Fiscal
2018
|
|
Q4
|
FY2018
|
|
|
|
|
GAAP diluted EPS
range*
|
$0.03 -
$0.04
|
$0.12 -
$0.13
|
|
Plus
|
|
|
|
Amortization of
purchased intangibles
|
$
0.09
|
$
0.39
|
|
Stock-based
expense
|
$
0.31
|
$
1.35
|
|
Amortization of debt
discount, net
|
$
0.01
|
$
0.04
|
|
Less
|
|
|
|
Income tax effects
and adjustments**
|
$
(0.12)
|
$
(0.58)
|
|
Non-GAAP diluted
EPS
|
$0.32 -
$0.33
|
$1.32 -
$1.33
|
|
|
|
|
Shares used in
computing basic net income per share (millions)
|
725
|
715
|
|
Shares used in
computing diluted net income per share (millions)
|
748
|
734
|
|
|
* The Company's GAAP
tax provision is expected to be 46% and 47% for the three and
twelve months ended January 31st, 2018, respectively.
|
|
** The Company's
non-GAAP tax provision uses a long-term projected tax rate of
34.5%.
|
For additional information regarding non-GAAP financial measures
see the reconciliation of results and related explanations
below.
Quarterly Conference Call
Salesforce will host a conference call at 2:00 p.m. (PT) / 5:00 p.m.
(ET) today to discuss its financial results with the
investment community. A live web broadcast of the event will
be available on the Salesforce Investor Relations website at
www.salesforce.com/investor. A live dial-in is available
domestically at 866-901-SFDC or 866-901-7332 and internationally at
706-902-1764, passcode 9689558. A replay will be available at
(800) 585-8367 or (855) 859-2056 until midnight (ET) Dec. 21,
2017.
About Salesforce
Salesforce, the global leader in CRM, empowers companies to connect
with their customers in a whole new way. Salesforce has
headquarters in San Francisco, with offices
in Europe and Asia, and trades on the New York
Stock Exchange under the ticker symbol "CRM." For more
information about Salesforce, visit: www.salesforce.com.
"Safe harbor" statement under the Private Securities
Litigation Reform Act of 1995: This press release
contains forward-looking statements about our financial results,
which may include expected GAAP and non-GAAP financial and other
operating and non-operating results, including revenue, net income,
diluted earnings per share, operating cash flow growth, operating
margin improvement, deferred revenue growth, expected revenue run
rate, expected tax rates, stock-based compensation expenses,
amortization of purchased intangibles, amortization of debt
discount and shares outstanding. The achievement or success
of the matters covered by such forward-looking statements involves
risks, uncertainties and assumptions. If any such risks or
uncertainties materialize or if any of the assumptions prove
incorrect, the company's results could differ materially from the
results expressed or implied by the forward-looking statements we
make.
The risks and uncertainties referred to above include -- but are
not limited to -- risks associated with possible fluctuations in
the company's financial and operating results; the company's rate
of growth and anticipated revenue run rate, including the company's
ability to convert deferred revenue and unbilled deferred revenue
into revenue and cash flow, and ability to maintain continued
growth of deferred revenue and unbilled deferred revenue; foreign
currency exchange rates; errors, interruptions or delays in the
company's services or the company's Web hosting; breaches of the
company's security measures; domestic and international regulatory
developments, including the adoption of new privacy laws; the
financial and other impact of any previous and future acquisitions;
the nature of the company's business model, including risks related
to government contracts; the company's ability to continue to
release, gain customer acceptance of and provide support for new
and improved versions of the company's services; successful
customer deployment and utilization of the company's existing and
future services; changes in the company's sales cycle; competition;
various financial aspects of the company's subscription model;
unexpected increases in attrition or decreases in new business; the
company's ability to realize benefits from strategic partnerships
and strategic investments; the emerging markets in which the
company operates; unique aspects of entering or expanding in
international markets, including the compliance with United States export control laws, the
company's ability to hire, retain and motivate employees and manage
the company's growth; changes in the company's customer base;
technological developments; litigation and any related claims,
negotiations and settlements, including with respect to
intellectual property matters or industry-specific regulations;
unanticipated changes in the company's effective tax rate; factors
affecting the company's outstanding convertible notes, term loan,
and revolving credit facility; fluctuations in the number of
company shares outstanding and the price of such shares; collection
of receivables; interest rates; factors affecting the company's
deferred tax assets and ability to value and utilize them; the
potential negative impact of indirect tax exposure; the risks and
expenses associated with the company's real estate and office
facilities space; and general developments in the economy,
financial markets, credit markets and the impact of current and
future accounting pronouncements and other financial reporting
standards.
Further information on these and other factors that could affect
the company's financial results is included in the reports on Forms
10-K, 10-Q and 8-K and in other filings we make with the Securities
and Exchange Commission from time to time. These documents
are available on the SEC Filings section of the Investor
Information section of the company's website at
www.salesforce.com/investor.
Salesforce.com, inc. assumes no obligation and does not intend
to update these forward-looking statements, except as required by
law.
© 2017 salesforce.com, inc. All rights
reserved. Salesforce and other marks are trademarks
of salesforce.com, inc. Other brands featured herein may
be trademarks of their respective owners.
Non-GAAP Financial Measures: This press release
includes information about non-GAAP diluted earnings per share,
non-GAAP tax rates, non-GAAP free cash flow, and constant currency
revenue and constant currency deferred revenue growth rates
(collectively the "non-GAAP financial measures"). These non-GAAP
financial measures are measurements of financial performance that
are not prepared in accordance with U.S. generally accepted
accounting principles and computational methods may differ from
those used by other companies. Non-GAAP financial measures are not
meant to be considered in isolation or as a substitute for
comparable GAAP measures and should be read only in conjunction
with the company's consolidated financial statements prepared in
accordance with GAAP. Management uses both GAAP and non-GAAP
measures when planning, monitoring, and evaluating the company's
performance.
The primary purpose of using non-GAAP measures is to provide
supplemental information that may prove useful to investors and to
enable investors to evaluate the company's results in the same way
management does. Management believes that supplementing GAAP
disclosure with non-GAAP disclosure provides investors with a more
complete view of the company's operational performance and allows
for meaningful period-to-period comparisons and analysis of trends
in the company's business. Further, to the extent that other
companies use similar methods in calculating non-GAAP measures, the
provision of supplemental non-GAAP information can allow for a
comparison of the company's relative performance against other
companies that also report non-GAAP operating results.
Non-GAAP diluted earnings per share excludes, to the extent
applicable, the impact of the following items: stock-based
compensation, amortization of acquisition-related intangibles,
amortization of acquired leases, the net amortization of debt
discount on the company's convertible senior notes, gains/losses on
conversions of the company's convertible senior notes, gains/losses
on sales of land and building improvements, gains/losses on
company-initiated acquisitions of entities in which the company
held an equity investment, and termination of office leases, as
well as income tax adjustments. These items are excluded
because the decisions that give rise to them are not made to
increase revenue in a particular period, but instead for the
company's long-term benefit over multiple periods.
Specifically, management is excluding the following items from
its non-GAAP earnings per share, as applicable, for the periods
presented in the Q3 FY18 financial statements and for its non-GAAP
estimates for Q4 and FY18:
- Stock-Based Expenses: The company's compensation strategy
includes the use of stock-based compensation to attract and retain
employees and executives. It is principally aimed at aligning their
interests with those of our stockholders and at long-term employee
retention, rather than to motivate or reward operational
performance for any particular period. Thus, stock-based
compensation expense varies for reasons that are generally
unrelated to operational decisions and performance in any
particular period.
- Amortization of Purchased Intangibles and Acquired Leases: The
company views amortization of acquisition- and building-related
intangible assets, such as the amortization of the cost associated
with an acquired company's research and development efforts, trade
names, customer lists and customer relationships, and acquired
lease intangibles, as items arising from pre-acquisition activities
determined at the time of an acquisition. While these intangible
assets are continually evaluated for impairment, amortization of
the cost of purchased intangibles is a static expense, one that is
not typically affected by operations during any particular
period.
- Amortization of Debt Discount: Under GAAP, certain convertible
debt instruments that may be settled in cash (or other assets) on
conversion are required to be separately accounted for as liability
(debt) and equity (conversion option) components of the instrument
in a manner that reflects the issuer's non-convertible debt
borrowing rate. Accordingly, for GAAP purposes we are required to
recognize imputed interest expense on the company's $1.15 billion of convertible senior notes due
2018 that were issued in a private placement in March 2013. The imputed interest rate was
approximately 2.5% for the convertible notes due 2018, while the
actual coupon interest rate of the notes is 0.25%. The difference
between the imputed interest expense and the coupon interest
expense, net of the interest amount capitalized, is excluded from
management's assessment of the company's operating performance
because management believes that this non-cash expense is not
indicative of ongoing operating performance.
- Gains on Acquisitions of Strategic Investments: The company
views gains on sales of its strategic investments resulting from
acquisitions initiated by the company in which an equity interest
was previously held as discrete events and not indicative of
operational performance during any particular period.
- Income Tax Effects and Adjustments: The company utilizes a
fixed long-term projected non-GAAP tax rate in order to provide
better consistency across the interim reporting periods by
eliminating the effects of items such as changes in the tax
valuation allowance and tax effects of acquisitions-related costs,
since each of these can vary in size and frequency. When projecting
this long-term rate, the company evaluated a three-year financial
projection that excludes the direct impact of the following
non-cash items: stock-based expenses, amortization of purchased
intangibles, amortization of acquired leases, amortization of debt
discount, gains/losses on the sales of land and building
improvements, gains on sales of strategic investments, and
termination of office leases. The projected rate also assumes no
new acquisitions in the three-year period, and considers other
factors including the company's tax structure, its tax positions in
various jurisdictions and key legislation in major jurisdictions
where the company operates. This long-term rate could be subject to
change for a variety of reasons, such as significant changes in the
geographic earnings mix including acquisition activity, or
fundamental tax law changes in major jurisdictions where the
company operates. The company re-evaluates this long-term rate on
an annual basis or if any significant events that may materially
affect this long-term rate occur. The non-GAAP tax rate for fiscal
2018 is 34.5 percent.
The company defines the non-GAAP measure free cash flow as GAAP
net cash provided by operating activities, less capital
expenditures. For this purpose, capital expenditures does not
include our strategic investments, nor does it include any costs or
activities related to our purchase of 50 Fremont land and building,
and building - leased facilities.
|
salesforce.com,
inc.
|
|
Consolidated
Statements of Operations
|
|
(in thousands,
except per share data)
|
|
(Unaudited)
|
|
|
Three Months Ended
October 31,
|
|
Nine Months Ended
October 31,
|
|
2017
|
|
2016
|
|
2017
|
|
2016
|
|
Revenues:
|
|
|
|
|
|
|
|
|
Subscription and
support
|
$
|
2,486,131
|
|
|
$
|
1,983,981
|
|
|
$
|
7,055,538
|
|
|
$
|
5,645,554
|
|
|
Professional services
and other
|
193,710
|
|
|
160,794
|
|
|
573,471
|
|
|
452,442
|
|
|
Total
revenues
|
2,679,841
|
|
|
2,144,775
|
|
|
7,629,009
|
|
|
6,097,996
|
|
|
Cost of revenues
(1)(2):
|
|
|
|
|
|
|
|
|
Subscription and
support
|
528,182
|
|
|
426,487
|
|
|
1,484,982
|
|
|
1,154,044
|
|
|
Professional services
and other
|
186,326
|
|
|
159,035
|
|
|
550,748
|
|
|
454,038
|
|
|
Total cost of
revenues
|
714,508
|
|
|
585,522
|
|
|
2,035,730
|
|
|
1,608,082
|
|
|
Gross
profit
|
1,965,333
|
|
|
1,559,253
|
|
|
5,593,279
|
|
|
4,489,914
|
|
|
Operating expenses
(1)(2):
|
|
|
|
|
|
|
|
|
Research and
development
|
393,998
|
|
|
311,459
|
|
|
1,156,526
|
|
|
863,935
|
|
|
Marketing and
sales
|
1,184,733
|
|
|
997,993
|
|
|
3,464,986
|
|
|
2,828,784
|
|
|
General and
administrative
|
270,614
|
|
|
246,765
|
|
|
813,868
|
|
|
709,622
|
|
|
Total operating
expenses
|
1,849,345
|
|
|
1,556,217
|
|
|
5,435,380
|
|
|
4,402,341
|
|
|
Income from
operations
|
115,988
|
|
|
3,036
|
|
|
157,899
|
|
|
87,573
|
|
|
Investment
income
|
10,049
|
|
|
3,709
|
|
|
24,069
|
|
|
23,747
|
|
|
Interest
expense
|
(21,557)
|
|
|
(21,946)
|
|
|
(65,382)
|
|
|
(64,665)
|
|
|
Other income
(expense) (1)
|
1,921
|
|
|
1,782
|
|
|
(2,695)
|
|
|
(11,500)
|
|
|
Gains from
acquisitions of strategic investments
|
0
|
|
|
833
|
|
|
0
|
|
|
13,697
|
|
|
Income (loss) before
benefit from (provision for) income taxes
|
106,401
|
|
|
(12,586)
|
|
|
113,891
|
|
|
48,852
|
|
|
Benefit from
(provision for) income taxes
|
(55,007)
|
|
|
(24,723)
|
|
|
(53,968)
|
|
|
182,220
|
|
|
Net income
(loss)
|
$
|
51,394
|
|
|
$
|
(37,309)
|
|
|
$
|
59,923
|
|
|
$
|
231,072
|
|
|
Basic net income
(loss) per share
|
$
|
0.07
|
|
|
$
|
(0.05)
|
|
|
$
|
0.08
|
|
|
$
|
0.34
|
|
|
Diluted net income
(loss) per share
|
$
|
0.07
|
|
|
$
|
(0.05)
|
|
|
$
|
0.08
|
|
|
$
|
0.33
|
|
|
Shares used in
computing basic net income (loss) per share
|
717,445
|
|
|
690,468
|
|
|
711,884
|
|
|
683,075
|
|
|
Shares used in
computing diluted net income (loss) per share
|
738,106
|
|
|
690,468
|
|
|
730,212
|
|
|
696,257
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(1)
|
Amounts include
amortization of purchased intangibles from business combinations,
as follows:
|
|
|
|
|
Three Months Ended
October 31,
|
|
Nine Months Ended
October 31,
|
|
|
2017
|
|
2016
|
|
2017
|
|
2016
|
|
Cost of
revenues
|
$
|
39,610
|
|
|
$
|
36,703
|
|
|
$
|
126,679
|
|
|
$
|
84,462
|
|
|
Marketing and
sales
|
30,067
|
|
|
28,064
|
|
|
91,274
|
|
|
66,601
|
|
|
Other non-operating
expense
|
367
|
|
|
579
|
|
|
1,118
|
|
|
1,927
|
|
|
|
|
(2)
|
Amounts include
stock-based expense, as follows:
|
|
|
|
|
Three Months Ended
October 31,
|
|
Nine Months Ended
October 31,
|
|
|
2017
|
|
2016
|
|
2017
|
|
2016
|
|
Cost of
revenues
|
$
|
33,494
|
|
|
$
|
26,783
|
|
|
$
|
97,206
|
|
|
$
|
76,912
|
|
|
Research and
development
|
66,626
|
|
|
50,372
|
|
|
197,185
|
|
|
124,164
|
|
|
Marketing and
sales
|
116,992
|
|
|
93,718
|
|
|
356,538
|
|
|
275,515
|
|
|
General and
administrative
|
34,165
|
|
|
33,878
|
|
|
108,402
|
|
|
99,389
|
|
|
salesforce.com,
inc.
|
|
Consolidated
Statements of Operations
|
|
(As a percentage
of total revenues)
|
|
(Unaudited)
|
|
|
Three Months Ended
October 31,
|
|
Nine Months Ended
October 31,
|
|
2017
|
|
2016
|
|
2017
|
|
2016
|
|
Revenues:
|
|
|
|
|
|
|
|
|
Subscription and
support
|
93%
|
|
|
93%
|
|
|
92%
|
|
|
93%
|
|
|
Professional services
and other
|
7
|
|
|
7
|
|
|
8
|
|
|
7
|
|
|
Total
revenues
|
100
|
|
|
100
|
|
|
100
|
|
|
100
|
|
|
Cost of revenues
(1)(2):
|
|
|
|
|
|
|
|
|
Subscription and
support
|
20
|
|
|
20
|
|
|
20
|
|
|
19
|
|
|
Professional services
and other
|
7
|
|
|
7
|
|
|
7
|
|
|
7
|
|
|
Total cost of
revenues
|
27
|
|
|
27
|
|
|
27
|
|
|
26
|
|
|
Gross
profit
|
73
|
|
|
73
|
|
|
73
|
|
|
74
|
|
|
Operating expenses
(1)(2):
|
|
|
|
|
|
|
|
|
Research and
development
|
15
|
|
|
15
|
|
|
15
|
|
|
14
|
|
|
Marketing and
sales
|
44
|
|
|
47
|
|
|
45
|
|
|
46
|
|
|
General and
administrative
|
10
|
|
|
11
|
|
|
11
|
|
|
12
|
|
|
Total operating
expenses
|
69
|
|
|
73
|
|
|
71
|
|
|
72
|
|
|
Income from
operations
|
4
|
|
|
0
|
|
|
2
|
|
|
2
|
|
|
Investment
income
|
1
|
|
|
0
|
|
|
0
|
|
|
0
|
|
|
Interest
expense
|
(1)
|
|
|
(1)
|
|
|
(1)
|
|
|
(1)
|
|
|
Other income
(expense) (1)
|
0
|
|
|
0
|
|
|
0
|
|
|
0
|
|
|
Gains from
acquisitions of strategic investments
|
0
|
|
|
0
|
|
|
0
|
|
|
0
|
|
|
Income (loss) before
benefit from (provision for) income taxes
|
4
|
|
|
(1)
|
|
|
1
|
|
|
1
|
|
|
Benefit from
(provision for) income taxes
|
(2)
|
|
|
(1)
|
|
|
0
|
|
|
3
|
|
|
Net income
(loss)
|
2%
|
|
|
(2)%
|
|
|
1%
|
|
|
4%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(1)
|
Amortization of
purchased intangibles from business combinations as a percentage of
total revenues, as follows:
|
|
|
|
|
Three Months Ended
October 31,
|
|
Nine Months Ended
October 31,
|
|
|
2017
|
|
2016
|
|
2017
|
|
2016
|
|
Cost of
revenues
|
|
1%
|
|
|
2%
|
|
|
2%
|
|
|
1%
|
|
Marketing and
sales
|
|
1
|
|
|
1
|
|
|
1
|
|
|
1
|
|
Other non-operating
expense
|
|
0
|
|
|
0
|
|
|
0
|
|
|
0
|
|
|
|
(2)
|
Stock-based expense
as a percentage of total revenues, as follows:
|
|
|
|
|
Three Months Ended
October 31,
|
|
Nine Months Ended
October 31,
|
|
|
2017
|
|
2016
|
|
2017
|
|
2016
|
|
Cost of
revenues
|
|
1%
|
|
|
1%
|
|
|
1%
|
|
|
1%
|
|
Research and
development
|
|
2
|
|
|
2
|
|
|
3
|
|
|
2
|
|
Marketing and
sales
|
|
4
|
|
|
4
|
|
|
5
|
|
|
5
|
|
General and
administrative
|
|
1
|
|
|
2
|
|
|
1
|
|
|
2
|
|
salesforce.com,
inc.
|
|
Consolidated
Balance Sheets
|
|
(in
thousands)
|
|
|
October 31,
2017
|
|
January 31,
2017
|
|
(unaudited)
|
|
|
|
Assets
|
|
|
|
|
Current
assets:
|
|
|
|
|
Cash and cash
equivalents
|
$
|
2,071,837
|
|
|
$
|
1,606,549
|
|
|
Marketable
securities
|
1,556,828
|
|
|
602,338
|
|
|
Accounts receivable,
net
|
1,519,916
|
|
|
3,196,643
|
|
|
Deferred
commissions
|
327,643
|
|
|
311,770
|
|
|
Prepaid expenses and
other current assets
|
469,946
|
|
|
279,527
|
|
|
Total current
assets
|
5,946,170
|
|
|
5,996,827
|
|
|
Property and
equipment, net
|
1,864,891
|
|
|
1,787,534
|
|
|
Deferred commissions,
noncurrent
|
253,004
|
|
|
227,849
|
|
|
Capitalized software,
net
|
140,768
|
|
|
141,671
|
|
|
Strategic
investments
|
670,406
|
|
|
566,953
|
|
|
Goodwill
|
7,294,141
|
|
|
7,263,846
|
|
|
Intangible assets
acquired through business combinations, net
|
895,768
|
|
|
1,113,374
|
|
|
Other assets,
net
|
424,888
|
|
|
486,869
|
|
|
Total
assets
|
$
|
17,490,036
|
|
|
$
|
17,584,923
|
|
|
Liabilities,
temporary equity and stockholders' equity
|
|
|
|
|
Current
liabilities:
|
|
|
|
|
Accounts payable,
accrued expenses and other liabilities
|
$
|
1,686,408
|
|
|
$
|
1,752,664
|
|
|
Deferred
revenue
|
4,392,082
|
|
|
5,542,802
|
|
|
Convertible 0.25%
senior notes, net
|
1,137,954
|
|
|
0
|
|
|
Total current
liabilities
|
7,216,444
|
|
|
7,295,466
|
|
|
Convertible 0.25%
senior notes, net
|
0
|
|
|
1,116,360
|
|
|
Term loan
|
498,084
|
|
|
497,221
|
|
|
Loan assumed on 50
Fremont
|
198,471
|
|
|
198,268
|
|
|
Revolving credit
facility
|
0
|
|
|
196,542
|
|
|
Other noncurrent
liabilities
|
736,870
|
|
|
780,939
|
|
|
Total
liabilities
|
8,649,869
|
|
|
10,084,796
|
|
|
Temporary
equity:
|
|
|
|
|
Convertible 0.25%
senior notes
|
10,797
|
|
|
0
|
|
|
Stockholders'
equity:
|
|
|
|
|
Common
stock
|
722
|
|
|
708
|
|
|
Additional paid-in
capital
|
9,230,081
|
|
|
8,040,170
|
|
|
Accumulated other
comprehensive income (loss)
|
3,554
|
|
|
(75,841)
|
|
|
Accumulated
deficit
|
(404,987)
|
|
|
(464,910)
|
|
|
Total stockholders'
equity
|
8,829,370
|
|
|
7,500,127
|
|
|
Total liabilities,
temporary equity and stockholders' equity
|
$
|
17,490,036
|
|
|
$
|
17,584,923
|
|
|
salesforce.com,
inc.
|
|
Consolidated
Statements of Cash Flows
|
|
(in
thousands)
|
|
(Unaudited)
|
|
|
Three Months Ended
October 31,
|
|
Nine Months Ended
October 31,
|
|
2017
|
|
2016
|
|
2017
|
|
2016
|
|
Operating
activities:
|
|
|
|
|
|
|
|
|
Net income
(loss)
|
$
|
51,394
|
|
|
$
|
(37,309)
|
|
|
$
|
59,923
|
|
|
$
|
231,072
|
|
|
Adjustments to
reconcile net income (loss) to net cash provided by operating
activities:
|
|
|
|
|
|
|
|
|
Depreciation and
amortization
|
187,546
|
|
|
169,346
|
|
|
564,911
|
|
|
451,479
|
|
|
Amortization of debt
discount and issuance costs
|
7,795
|
|
|
7,281
|
|
|
23,265
|
|
|
21,334
|
|
|
Gains from
acquisitions of strategic investments
|
0
|
|
|
(833)
|
|
|
0
|
|
|
(13,697)
|
|
|
Amortization of
deferred commissions
|
117,677
|
|
|
93,230
|
|
|
331,687
|
|
|
270,527
|
|
|
Expenses related to
employee stock plans
|
251,277
|
|
|
204,751
|
|
|
759,331
|
|
|
575,980
|
|
|
Changes in assets and
liabilities, net of business combinations:
|
|
|
|
|
|
|
|
|
Accounts receivable,
net
|
49,406
|
|
|
42,653
|
|
|
1,677,466
|
|
|
1,276,798
|
|
|
Deferred
commissions
|
(171,562)
|
|
|
(92,803)
|
|
|
(372,714)
|
|
|
(226,965)
|
|
|
Prepaid expenses and
other current assets and other assets
|
(15,669)
|
|
|
40,676
|
|
|
(166,784)
|
|
|
(25,723)
|
|
|
Accounts payable,
accrued expenses and other liabilities
|
74,480
|
|
|
57,836
|
|
|
(39,720)
|
|
|
(275,058)
|
|
|
Deferred
revenue
|
(426,552)
|
|
|
(330,516)
|
|
|
(1,150,720)
|
|
|
(829,695)
|
|
|
Net cash provided by
operating activities
|
125,792
|
|
|
154,312
|
|
|
1,686,645
|
|
|
1,456,052
|
|
|
Investing
activities:
|
|
|
|
|
|
|
|
|
Business
combinations, net of cash acquired
|
0
|
|
|
(32,117)
|
|
|
(19,781)
|
|
|
(2,832,110)
|
|
|
Purchases of
strategic investments
|
(54,585)
|
|
|
(28,660)
|
|
|
(113,088)
|
|
|
(65,834)
|
|
|
Sales of strategic
investments
|
40,811
|
|
|
11,783
|
|
|
55,898
|
|
|
26,506
|
|
|
Purchases of
marketable securities
|
(233,824)
|
|
|
(111,731)
|
|
|
(1,433,718)
|
|
|
(986,862)
|
|
|
Sales of marketable
securities
|
193,783
|
|
|
93,391
|
|
|
437,248
|
|
|
1,927,049
|
|
|
Maturities of
marketable securities
|
29,819
|
|
|
14,203
|
|
|
43,089
|
|
|
64,741
|
|
|
Capital
expenditures
|
(111,278)
|
|
|
(140,653)
|
|
|
(396,268)
|
|
|
(319,984)
|
|
|
Net cash used in
investing activities
|
(135,274)
|
|
|
(193,784)
|
|
|
(1,426,620)
|
|
|
(2,186,494)
|
|
|
Financing
activities:
|
|
|
|
|
|
|
|
|
Proceeds from term
loan, net
|
0
|
|
|
0
|
|
|
0
|
|
|
495,550
|
|
|
Proceeds from
employee stock plans
|
141,970
|
|
|
92,846
|
|
|
484,786
|
|
|
315,865
|
|
|
Principal payments on
capital lease obligations
|
(7,716)
|
|
|
(10,997)
|
|
|
(82,890)
|
|
|
(73,760)
|
|
|
Payments on revolving
credit facility
|
0
|
|
|
0
|
|
|
(200,000)
|
|
|
0
|
|
|
Net cash provided by
financing activities
|
134,254
|
|
|
81,849
|
|
|
201,896
|
|
|
737,655
|
|
|
Effect of exchange
rate changes
|
(2,045)
|
|
|
(11,867)
|
|
|
3,367
|
|
|
(19,840)
|
|
|
Net increase
(decrease) in cash and cash equivalents
|
122,727
|
|
|
30,510
|
|
|
465,288
|
|
|
(12,627)
|
|
|
Cash and cash
equivalents, beginning of period
|
1,949,110
|
|
|
1,115,226
|
|
|
1,606,549
|
|
|
1,158,363
|
|
|
Cash and cash
equivalents, end of period
|
$
|
2,071,837
|
|
|
$
|
1,145,736
|
|
|
$
|
2,071,837
|
|
|
$
|
1,145,736
|
|
|
salesforce.com,
inc.
|
|
Additional
Metrics
|
|
(Unaudited)
|
|
|
Oct 31,
2017
|
|
Jul 31,
2017
|
|
Apr 30,
2017
|
|
Jan 31,
2017
|
|
Oct 31,
2016
|
|
Jul 31,
2016
|
|
Full Time
Equivalent Headcount
|
28,527
|
|
|
27,155
|
|
|
26,213
|
|
|
25,178
|
|
|
23,939
|
|
|
23,247
|
|
|
Financial data (in
thousands):
|
|
|
|
|
|
|
|
|
|
|
|
|
Cash, cash
equivalents and marketable securities
|
$
|
3,628,665
|
|
|
$
|
3,501,245
|
|
|
$
|
3,219,550
|
|
|
$
|
2,208,887
|
|
|
$
|
1,751,130
|
|
|
$
|
1,719,946
|
|
|
Strategic
investments
|
$
|
670,406
|
|
|
$
|
657,687
|
|
|
$
|
639,191
|
|
|
$
|
566,953
|
|
|
$
|
555,968
|
|
|
$
|
548,258
|
|
|
Deferred
revenue
|
$
|
4,392,082
|
|
|
$
|
4,818,634
|
|
|
$
|
5,042,652
|
|
|
$
|
5,542,802
|
|
|
$
|
3,495,133
|
|
|
$
|
3,823,561
|
|
|
Unbilled deferred
revenue, a non-GAAP measure (1)
|
$
|
11,500,000
|
|
|
$
|
10,400,000
|
|
|
$
|
9,600,000
|
|
|
$
|
9,000,000
|
|
|
$
|
8,600,000
|
|
|
$
|
8,000,000
|
|
|
Principal due on our
outstanding debt obligations
|
$
|
1,850,000
|
|
|
$
|
1,850,000
|
|
|
$
|
1,850,000
|
|
|
$
|
2,050,000
|
|
|
$
|
1,850,000
|
|
|
$
|
1,850,000
|
|
|
|
|
(1)
|
Unbilled deferred
revenue represents future billings under our non-cancelable
subscription agreements that have not been invoiced and,
accordingly, are not recorded in deferred revenue.
|
|
Selected Balance
Sheet Accounts (in thousands):
|
|
|
October 31,
2017
|
|
July 31,
2017
|
|
January 31,
2017
|
|
Prepaid
Expenses and Other Current Assets
|
|
|
|
|
|
|
Prepaid income
taxes
|
$
|
43,301
|
|
|
$
|
75,031
|
|
|
$
|
26,932
|
|
|
Other taxes
receivable
|
33,099
|
|
|
36,634
|
|
|
34,177
|
|
|
Prepaid expenses and
other current assets
|
393,546
|
|
|
326,581
|
|
|
218,418
|
|
|
$
|
469,946
|
|
|
$
|
438,246
|
|
|
$
|
279,527
|
|
|
Property and
Equipment, net
|
|
|
|
|
|
|
Land
|
$
|
183,888
|
|
|
$
|
183,888
|
|
|
$
|
183,888
|
|
|
Buildings and
building improvements
|
626,168
|
|
|
623,411
|
|
|
621,377
|
|
|
Computers, equipment
and software
|
1,600,783
|
|
|
1,555,572
|
|
|
1,440,986
|
|
|
Furniture and
fixtures
|
132,374
|
|
|
125,858
|
|
|
112,564
|
|
|
Leasehold
improvements
|
776,396
|
|
|
741,466
|
|
|
627,069
|
|
|
3,319,609
|
|
|
3,230,195
|
|
|
2,985,884
|
|
|
Less accumulated
depreciation and amortization
|
(1,454,718)
|
|
|
(1,363,619)
|
|
|
(1,198,350)
|
|
|
$
|
1,864,891
|
|
|
$
|
1,866,576
|
|
|
$
|
1,787,534
|
|
|
Intangible
Assets Acquired Through Business Combinations,
net
|
|
|
|
|
|
|
Acquired developed
technology
|
$
|
388,346
|
|
|
$
|
427,870
|
|
|
$
|
514,232
|
|
|
Customer
relationships
|
501,500
|
|
|
531,065
|
|
|
589,579
|
|
|
Trade names and
trademarks
|
3,071
|
|
|
3,581
|
|
|
4,601
|
|
|
Territory rights and
other
|
2,534
|
|
|
2,690
|
|
|
3,530
|
|
|
50 Fremont lease
intangibles
|
317
|
|
|
681
|
|
|
1,432
|
|
|
$
|
895,768
|
|
|
$
|
965,887
|
|
|
$
|
1,113,374
|
|
|
Other Assets,
net
|
|
|
|
|
|
|
Deferred income
taxes, noncurrent, net
|
$
|
31,596
|
|
|
$
|
29,926
|
|
|
$
|
28,939
|
|
|
Long-term
deposits
|
23,979
|
|
|
24,305
|
|
|
23,597
|
|
|
Domain names and
patents, net
|
26,811
|
|
|
30,662
|
|
|
39,213
|
|
|
Customer contract
assets
|
201,357
|
|
|
229,597
|
|
|
281,733
|
|
|
Other
|
141,145
|
|
|
143,506
|
|
|
113,387
|
|
|
$
|
424,888
|
|
|
$
|
457,996
|
|
|
$
|
486,869
|
|
|
Accounts
Payable, Accrued Expenses and Other Liabilities
|
|
|
|
|
|
|
Accounts
payable
|
$
|
120,019
|
|
|
$
|
148,279
|
|
|
$
|
115,257
|
|
|
Accrued
compensation
|
622,419
|
|
|
517,433
|
|
|
730,390
|
|
|
Non-cash equity
liability
|
49,435
|
|
|
55,394
|
|
|
68,355
|
|
|
Accrued other
liabilities
|
488,071
|
|
|
452,398
|
|
|
419,299
|
|
|
Accrued income and
other taxes payable
|
193,693
|
|
|
196,670
|
|
|
239,699
|
|
|
Accrued professional
costs
|
44,757
|
|
|
46,579
|
|
|
38,254
|
|
|
Accrued
rent
|
33,968
|
|
|
21,384
|
|
|
19,710
|
|
|
Capital lease
obligation, current
|
114,147
|
|
|
118,888
|
|
|
102,106
|
|
|
Financing obligation
- leased facility, current
|
19,899
|
|
|
19,797
|
|
|
19,594
|
|
|
$
|
1,686,408
|
|
|
$
|
1,576,822
|
|
|
$
|
1,752,664
|
|
|
Other
Noncurrent Liabilities
|
|
|
|
|
|
|
Deferred income taxes
and income taxes payable
|
$
|
117,193
|
|
|
$
|
111,404
|
|
|
$
|
99,378
|
|
|
Financing obligation
- leased facility
|
198,903
|
|
|
199,539
|
|
|
200,711
|
|
|
Long-term lease
liabilities and other
|
420,774
|
|
|
416,939
|
|
|
480,850
|
|
|
$
|
736,870
|
|
|
$
|
727,882
|
|
|
$
|
780,939
|
|
|
Supplemental
Revenue Analysis
|
|
|
Subscription and
support revenue by cloud service offering (in
millions):
|
Three Months Ended
October 31,
|
|
Nine Months Ended
October 31,
|
|
2017
|
|
2016
|
|
2017
|
|
2016
|
|
Sales
Cloud
|
$
|
906.5
|
|
|
$
|
776.2
|
|
|
$
|
2,622.5
|
|
|
$
|
2,255.7
|
|
|
Service
Cloud
|
738.1
|
|
|
589.9
|
|
|
2,087.8
|
|
|
1,705.4
|
|
|
Salesforce Platform
and Other
|
495.3
|
|
|
370.7
|
|
|
1,392.9
|
|
|
1,050.0
|
|
|
Marketing and
Commerce Cloud
|
346.2
|
|
|
247.2
|
|
|
952.3
|
|
|
634.5
|
|
|
$
|
2,486.1
|
|
|
$
|
1,984.0
|
|
|
$
|
7,055.5
|
|
|
$
|
5,645.6
|
|
|
|
Three Months Ended
October 31,
|
|
Nine Months Ended
October 31,
|
|
2017
|
|
2016
|
|
2017
|
|
2016
|
|
Total revenues by
geography (in thousands):
|
|
|
|
|
|
|
|
|
Americas
|
$
|
1,927,405
|
|
|
$
|
1,598,344
|
|
|
$
|
5,536,932
|
|
|
$
|
4,506,774
|
|
|
Europe
|
493,732
|
|
|
337,497
|
|
|
1,367,718
|
|
|
1,012,671
|
|
|
Asia
Pacific
|
258,704
|
|
|
208,934
|
|
|
724,359
|
|
|
578,551
|
|
|
$
|
2,679,841
|
|
|
$
|
2,144,775
|
|
|
$
|
7,629,009
|
|
|
$
|
6,097,996
|
|
|
|
|
|
|
|
|
|
|
Total revenues by
geography as a percentage of total revenues:
|
Three Months Ended
October 31,
|
|
Nine Months Ended
October 31,
|
|
2017
|
|
2016
|
|
2017
|
|
|
2016
|
|
|
Americas
|
72%
|
|
|
74%
|
|
|
73%
|
|
|
74%
|
|
|
Europe
|
18
|
|
|
16
|
|
|
18
|
|
|
17
|
|
|
Asia
Pacific
|
10
|
|
|
10
|
|
|
9
|
|
|
9
|
|
|
100%
|
|
|
100%
|
|
|
100%
|
|
|
100%
|
|
|
Revenue constant
currency growth rates (as compared to the comparable prior
periods)
|
Three Months Ended
October 31, 2017
compared to Three
Months
Ended October 31, 2016
|
|
Three Months Ended
July 31, 2017
compared to Three
Months
Ended July 31, 2016
|
|
Three Months Ended
October 31, 2016
compared to Three
Months
Ended October 31, 2015
|
|
Americas
|
21%
|
|
24%
|
|
27%
|
|
Europe
|
33%
|
|
31%
|
|
27%
|
|
Asia
Pacific
|
27%
|
|
27%
|
|
29%
|
|
Total
growth
|
23%
|
|
25%
|
|
27%
|
|
We present constant
currency information to provide a framework for assessing how our
underlying business performed excluding the effect of foreign
currency rate fluctuations. To present this information, current
and comparative prior period results for entities reporting in
currencies other than United States dollars are converted into
United States dollars at the weighted average exchange rate for the
quarter being compared to for growth rate calculations presented,
rather than the actual exchange rates in effect during that
period.
|
|
|
|
Deferred revenue
constant currency growth rates (as compared to the comparable prior
periods)
|
October 31,
2017
compared to
October 31, 2016
|
|
July 31, 2017
compared to
July 31, 2016
|
|
October 31,
2016
compared to
October 31, 2015
|
|
Total
growth
|
24%
|
|
25%
|
|
25%
|
|
We present constant
currency information for deferred revenue to provide a framework
for assessing how our underlying business performed excluding the
effects of foreign currency rate fluctuations. To present the
information above, we convert the deferred revenue balances in
local currencies in previous comparable periods using the United
States dollar currency exchange rate as on the most recent balance
sheet date.
|
|
|
|
Supplemental GAAP
and Non-GAAP Diluted Share Count Information
|
|
(share data in
thousands)
|
|
|
Three Months Ended
October 31,
|
|
Nine Months Ended
October 31,
|
|
2017
|
|
2016
|
|
2017
|
|
2016
|
|
Weighted-average
shares outstanding for basic earnings per share
|
717,445
|
|
|
690,468
|
|
|
711,884
|
|
|
683,075
|
|
|
Effect of dilutive
securities:
|
|
|
|
|
|
|
|
|
Convertible senior
notes
|
5,162
|
|
|
2,059
|
|
|
4,571
|
|
|
1,994
|
|
|
Employee stock
awards
|
14,717
|
|
|
12,177
|
|
|
13,235
|
|
|
11,188
|
|
|
Warrants
|
782
|
|
|
0
|
|
|
522
|
|
|
0
|
|
|
Adjusted
weighted-average shares outstanding and assumed conversions for
GAAP and Non-GAAP diluted earnings per share
|
738,106
|
|
|
704,704
|
|
|
730,212
|
|
|
696,257
|
|
|
Supplemental Cash
Flow Information
|
|
Free cash flow
analysis, a non-GAAP measure
|
|
(in
thousands)
|
|
|
Three Months Ended
October 31,
|
|
Nine Months Ended
October 31,
|
|
2017
|
|
2016
|
|
2017
|
|
2016
|
|
Operating cash
flow
|
|
|
|
|
|
|
|
|
GAAP net cash
provided by operating activities
|
$
|
125,792
|
|
|
$
|
154,312
|
|
|
$
|
1,686,645
|
|
|
$
|
1,456,052
|
|
|
Less:
|
|
|
|
|
|
|
|
|
Capital
expenditures
|
(111,278)
|
|
|
(140,653)
|
|
|
(396,268)
|
|
|
(319,984)
|
|
|
Free cash
flow
|
$
|
14,514
|
|
|
$
|
13,659
|
|
|
$
|
1,290,377
|
|
|
$
|
1,136,068
|
|
|
Comprehensive
Income (Loss)
|
|
(in
thousands)
|
|
(Unaudited)
|
|
|
Three Months Ended
October 31,
|
|
Nine Months Ended
October 31,
|
|
2017
|
|
2016
|
|
2017
|
|
2016
|
|
Net income
(loss)
|
$
|
51,394
|
|
|
$
|
(37,309)
|
|
|
$
|
59,923
|
|
|
$
|
231,072
|
|
|
Other comprehensive
income (loss), before tax and net of reclassification
adjustments:
|
|
|
|
|
|
|
|
|
Foreign currency
translation and other gains (losses)
|
(2,218)
|
|
|
(28,372)
|
|
|
28,190
|
|
|
(28,523)
|
|
|
Unrealized gains
(losses) on marketable securities and strategic
investments
|
(11,763)
|
|
|
(16,019)
|
|
|
51,205
|
|
|
20,961
|
|
|
Other comprehensive
income (loss), before tax
|
(13,981)
|
|
|
(44,391)
|
|
|
79,395
|
|
|
(7,562)
|
|
|
Tax effect
|
0
|
|
|
(7,337)
|
|
|
0
|
|
|
(5,464)
|
|
|
Other comprehensive
income (loss), net of tax
|
(13,981)
|
|
|
(51,728)
|
|
|
79,395
|
|
|
(13,026)
|
|
|
Comprehensive income
(loss)
|
$
|
37,413
|
|
|
$
|
(89,037)
|
|
|
$
|
139,318
|
|
|
$
|
218,046
|
|
|
salesforce.com,
inc.
|
|
GAAP Results
Reconciled to non-GAAP Results
|
|
The following table
reflects selected GAAP results reconciled to non-GAAP
results.
|
|
(in thousands, except
per share data)
|
|
(Unaudited)
|
|
|
Three Months Ended
October 31,
|
|
Nine Months Ended
October 31,
|
|
2017
|
|
2016
|
|
2017
|
|
2016
|
|
Non-GAAP gross
profit
|
|
|
|
|
|
|
|
|
GAAP gross
profit
|
$
|
1,965,333
|
|
|
$
|
1,559,253
|
|
|
$
|
5,593,279
|
|
|
$
|
4,489,914
|
|
|
Plus:
|
|
|
|
|
|
|
|
|
Amortization of
purchased intangibles (a)
|
39,610
|
|
|
36,703
|
|
|
126,679
|
|
|
84,462
|
|
|
Stock-based expense
(b)
|
33,494
|
|
|
26,783
|
|
|
97,206
|
|
|
76,912
|
|
|
Non-GAAP gross
profit
|
$
|
2,038,437
|
|
|
$
|
1,622,739
|
|
|
$
|
5,817,164
|
|
|
$
|
4,651,288
|
|
|
Non-GAAP operating
expenses
|
|
|
|
|
|
|
|
|
GAAP operating
expenses
|
$
|
1,849,345
|
|
|
$
|
1,556,217
|
|
|
$
|
5,435,380
|
|
|
$
|
4,402,341
|
|
|
Less:
|
|
|
|
|
|
|
|
|
Amortization of
purchased intangibles (a)
|
(30,067)
|
|
|
(28,064)
|
|
|
(91,274)
|
|
|
(66,601)
|
|
|
Stock-based expense
(b)
|
(217,783)
|
|
|
(177,968)
|
|
|
(662,125)
|
|
|
(499,068)
|
|
|
Non-GAAP operating
expenses
|
$
|
1,601,495
|
|
|
$
|
1,350,185
|
|
|
$
|
4,681,981
|
|
|
$
|
3,836,672
|
|
|
Non-GAAP income
from operations
|
|
|
|
|
|
|
|
|
GAAP income from
operations
|
$
|
115,988
|
|
|
$
|
3,036
|
|
|
$
|
157,899
|
|
|
$
|
87,573
|
|
|
Plus:
|
|
|
|
|
|
|
|
|
Amortization of
purchased intangibles (a)
|
69,677
|
|
|
64,767
|
|
|
217,953
|
|
|
151,063
|
|
|
Stock-based expense
(b)
|
251,277
|
|
|
204,751
|
|
|
759,331
|
|
|
575,980
|
|
|
Non-GAAP income from
operations
|
$
|
436,942
|
|
|
$
|
272,554
|
|
|
$
|
1,135,183
|
|
|
$
|
814,616
|
|
|
Non-GAAP
non-operating loss (c)
|
|
|
|
|
|
|
|
|
GAAP non-operating
loss
|
$
|
(9,587)
|
|
|
$
|
(15,622)
|
|
|
$
|
(44,008)
|
|
|
$
|
(38,721)
|
|
|
Plus:
|
|
|
|
|
|
|
|
|
Amortization of debt
discount, net
|
6,463
|
|
|
6,304
|
|
|
19,269
|
|
|
18,794
|
|
|
Amortization of
acquired lease intangible
|
367
|
|
|
579
|
|
|
1,118
|
|
|
1,927
|
|
|
Less:
|
|
|
|
|
|
|
|
|
Gains from
acquisitions of strategic investments
|
0
|
|
|
(833)
|
|
|
0
|
|
|
(13,697)
|
|
|
Non-GAAP
non-operating loss
|
$
|
(2,757)
|
|
|
$
|
(9,572)
|
|
|
$
|
(23,621)
|
|
|
$
|
(31,697)
|
|
|
Non-GAAP net
income
|
|
|
|
|
|
|
|
|
GAAP net income
(loss)
|
$
|
51,394
|
|
|
$
|
(37,309)
|
|
|
$
|
59,923
|
|
|
$
|
231,072
|
|
|
Plus:
|
|
|
|
|
|
|
|
|
Amortization of
purchased intangibles (a)
|
69,677
|
|
|
64,767
|
|
|
217,953
|
|
|
151,063
|
|
|
Amortization of
acquired lease intangible
|
367
|
|
|
579
|
|
|
1,118
|
|
|
1,927
|
|
|
Stock-based expense
(b)
|
251,277
|
|
|
204,751
|
|
|
759,331
|
|
|
575,980
|
|
|
Amortization of debt
discount, net
|
6,463
|
|
|
6,304
|
|
|
19,269
|
|
|
18,794
|
|
|
Less:
|
|
|
|
|
|
|
|
|
Gains from
acquisitions of strategic investments
|
0
|
|
|
(833)
|
|
|
0
|
|
|
(13,697)
|
|
|
Income tax effects
and adjustments
|
(94,787)
|
|
|
(67,320)
|
|
|
(329,521)
|
|
|
(456,241)
|
|
|
Non-GAAP net
income
|
$
|
284,391
|
|
|
$
|
170,939
|
|
|
$
|
728,073
|
|
|
$
|
508,898
|
|
|
|
Three Months Ended
October 31,
|
|
Nine Months Ended
October 31,
|
|
2017
|
|
2016
|
|
2017
|
|
2016
|
|
Non-GAAP diluted
earnings per share
|
|
|
|
|
|
|
|
|
GAAP diluted net
income (loss) per share
|
$
|
0.07
|
|
|
$
|
(0.05)
|
|
|
$
|
0.08
|
|
|
$
|
0.33
|
|
|
Plus:
|
|
|
|
|
|
|
|
|
Amortization of
purchased intangibles
|
0.10
|
|
|
0.09
|
|
|
0.30
|
|
|
0.22
|
|
|
Amortization of
acquired lease intangible
|
0.00
|
|
|
0.00
|
|
|
0.00
|
|
|
0.00
|
|
|
Stock-based
expense
|
0.34
|
|
|
0.29
|
|
|
1.04
|
|
|
0.83
|
|
|
Amortization of debt
discount, net
|
0.01
|
|
|
0.01
|
|
|
0.03
|
|
|
0.03
|
|
|
Less:
|
|
|
|
|
|
|
|
|
Gains from
acquisitions of strategic investments
|
0.00
|
|
|
0.00
|
|
|
0.00
|
|
|
(0.02)
|
|
|
Income tax effects
and adjustments
|
(0.13)
|
|
|
(0.10)
|
|
|
(0.45)
|
|
|
(0.66)
|
|
|
Non-GAAP diluted
earnings per share
|
$
|
0.39
|
|
|
$
|
0.24
|
|
|
$
|
1.00
|
|
|
$
|
0.73
|
|
|
Shares used in
computing Non-GAAP diluted net income per share
|
738,106
|
|
|
704,704
|
|
|
730,212
|
|
|
696,257
|
|
|
|
|
a)
|
Amortization of
purchased intangibles were as follows:
|
|
|
|
|
Three Months Ended
October 31,
|
|
Nine Months Ended
October 31,
|
|
|
2017
|
|
2016
|
|
2017
|
|
2016
|
|
Cost of
revenues
|
$
|
39,610
|
|
|
$
|
36,703
|
|
|
$
|
126,679
|
|
|
$
|
84,462
|
|
|
Marketing and
sales
|
30,067
|
|
|
28,064
|
|
|
91,274
|
|
|
66,601
|
|
|
|
$
|
69,677
|
|
|
$
|
64,767
|
|
|
$
|
217,953
|
|
|
$
|
151,063
|
|
|
|
|
b)
|
Stock-based expense
was as follows:
|
|
|
|
|
Three Months Ended
October 31,
|
|
Nine Months Ended
October 31,
|
|
|
2017
|
|
2016
|
|
2017
|
|
2016
|
|
Cost of
revenues
|
$
|
33,494
|
|
|
$
|
26,783
|
|
|
$
|
97,206
|
|
|
$
|
76,912
|
|
|
Research and
development
|
66,626
|
|
|
50,372
|
|
|
197,185
|
|
|
124,164
|
|
|
Marketing and
sales
|
116,992
|
|
|
93,718
|
|
|
356,538
|
|
|
275,515
|
|
|
General and
administrative
|
34,165
|
|
|
33,878
|
|
|
108,402
|
|
|
99,389
|
|
|
|
$
|
251,277
|
|
|
$
|
204,751
|
|
|
$
|
759,331
|
|
|
$
|
575,980
|
|
|
|
|
c)
|
GAAP non-operating
loss consists of investment income, interest expense, other income
(expense) and gains from acquisitions of strategic
investments.
|
|
salesforce.com,
inc.
|
|
Computation of
Basic and Diluted GAAP and non-GAAP Net Income (Loss) Per
Share
|
|
(in thousands, except
per share data)
|
|
(Unaudited)
|
|
|
Three Months Ended
October 31,
|
|
Nine Months Ended
October 31,
|
|
2017
|
|
2016
|
|
2017
|
|
2016
|
|
GAAP Basic Net
Income (Loss) Per Share
|
|
|
|
|
|
|
|
|
Net income
(loss)
|
$
|
51,394
|
|
|
$
|
(37,309)
|
|
|
$
|
59,923
|
|
|
$
|
231,072
|
|
|
Basic net income
(loss) per share
|
$
|
0.07
|
|
|
$
|
(0.05)
|
|
|
$
|
0.08
|
|
|
$
|
0.34
|
|
|
Shares used in
computing basic net income (loss) per share
|
717,445
|
|
|
690,468
|
|
|
711,884
|
|
|
683,075
|
|
|
|
|
|
|
|
|
|
|
Three Months Ended
October 31,
|
|
Nine Months Ended
October 31,
|
|
2017
|
|
2016
|
|
2017
|
|
2016
|
|
Non-GAAP Basic Net
Income Per Share
|
|
|
|
|
|
|
|
|
Non-GAAP net
income
|
$
|
284,391
|
|
|
$
|
170,939
|
|
|
$
|
728,073
|
|
|
$
|
508,898
|
|
|
Basic Non-GAAP net
income per share
|
$
|
0.40
|
|
|
$
|
0.25
|
|
|
$
|
1.02
|
|
|
$
|
0.75
|
|
|
Shares used in
computing basic Non-GAAP net income per share
|
717,445
|
|
|
690,468
|
|
|
711,884
|
|
|
683,075
|
|
|
|
|
|
|
|
|
|
|
Three Months Ended
October 31,
|
|
Nine Months Ended
October 31,
|
|
2017
|
|
2016
|
|
2017
|
|
2016
|
|
GAAP Diluted Net
Income (Loss) Per Share
|
|
|
|
|
|
|
|
|
Net income
(loss)
|
$
|
51,394
|
|
|
$
|
(37,309)
|
|
|
$
|
59,923
|
|
|
$
|
231,072
|
|
|
Diluted net income
(loss) per share
|
$
|
0.07
|
|
|
$
|
(0.05)
|
|
|
$
|
0.08
|
|
|
$
|
0.33
|
|
|
Shares used in
computing diluted net income (loss) per share
|
738,106
|
|
|
690,468
|
|
|
730,212
|
|
|
696,257
|
|
|
|
|
|
|
|
|
|
|
Three Months Ended
October 31,
|
|
Nine Months Ended
October 31,
|
|
2017
|
|
2016
|
|
2017
|
|
2016
|
|
Non-GAAP Diluted
Net Income Per Share
|
|
|
|
|
|
|
|
|
Non-GAAP net
income
|
$
|
284,391
|
|
|
$
|
170,939
|
|
|
$
|
728,073
|
|
|
$
|
508,898
|
|
|
Diluted Non-GAAP net
income per share
|
$
|
0.39
|
|
|
$
|
0.24
|
|
|
$
|
1.00
|
|
|
$
|
0.73
|
|
|
Shares used in
computing diluted Non-GAAP net income per share
|
738,106
|
|
|
704,704
|
|
|
730,212
|
|
|
696,257
|
|
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SOURCE Salesforce