Salesforce jumps after hours as fiscal 2019 guidance beats estimates

Key Points
  • Salesforce said it aims to bring in $12.45-12.5 billion in revenue in its 2019 fiscal year, which ends in January 2019.
  • The guidance would indicate as much as 20 percent revenue growth.
Marc Benioff
Frank Muldoon | CNBC

Salesforce stock rose 2.5 percent after hours on Monday after the company disclosed guidance for its 2019 fiscal year for the first time. The guidance suggests the company could post revenue growth of up to 20 percent.

In a statement the company said it would bring in $12.45 billion to $12.5 billion in revenue for the fiscal year, which will end on Jan. 31, 2019. According to FactSet, analysts estimated an average of $12.46 billion in revenue for the period, which falls at the lower end of the guidance range.

In August the company estimated it would bring in $10.35 billion to 10.4 billion in revenue for the full 2018 fiscal year, which would be up 23-24 percent year over year. The high end of the guidance for the 2019 fiscal year implies a 20 percent revenue increase.

And the actual revenue may be higher, based on past performance. "For the revenue target, as is customary for the company, we think initial forecast will likely prove to be conservative as management is likely to walk the numbers higher," Mizuho analysts Abhey Lamba and Parthiv Varadarajan wrote in a note.

Also on Monday Salesforce announced a partnership with Google that touches on using Google public cloud infrastructure and integrating with Google cloud applications.

Salesforce is set to hold its annual investor day at its Dreamforce conference in San Francisco on Tuesday. The company reports earnings for the third quarter of its 2018 fiscal year on Nov. 21.