Jason Lemkin, a start-up investor and founder of SaaStr, said that chief information officers are dedicating almost twice as much money as a percentage of their budget to cloud platforms as they were five years ago, benefiting this whole class of suppliers.
"We're all stunned at how big these SaaS and cloud companies are," Lemkin said. "The valuations are priced to perfection but nothing seems to be able to stop the migration of the CIO budget to the cloud. All of us got that wrong."
Salesforce and Workday weren't the only companies to provide upbeat news. Other emerging software and infrastructure providers to report better-than-expected results this week included Splunk, Box, Veeva, Nutanix and Anaplan, which went public last month.
Veeva CEO Peter Gassner told investors on Wednesday that demand for his company's health software continues to grow because customers need it to deal with all the complex regulations of the industry, which has more personalized and specialized medicines than ever before.
"Complexity is just increasing and now they see, hey, there's a cloud solution that can do the job and that's what's creating the momentum," Gassner said.
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