Friday, August 26, 2011

How Salesforce Tames Twitter for Big Business - BusinessWeek

From a Salesforce social snapshot

Benioff says the social media push will help Salesforce nearly quintuple annual sales, to $10 billion, though he sets no date for that goal. Wall Street is optimistic. Today the stock is trading at 821 times last year’s earnings, 6.6 times the tech industry average, according to Bloomberg data. This despite the fact that Salesforce earned just $43.1 million in the second quarter—and actually suffered a small loss if options and other expenses are included. Next quarter, analysts expect the company to lose $6.5 million, in part because of hiring and acquisition expenses. In May, Salesforce paid $340 million for Radian6, which makes software to monitor social media conversations (and is now a part of the Winter ’12 offering). Meanwhile, early social media initiatives aren’t exactly raking in big bucks. Salesforce had to cut the price of the first iteration of Chatter from $50 to $15 per user per month, says Benioff. “The bear story is they’re spending money somewhat like drunken sailors,” says Brent Thill, an analyst at UBS (UBS) who nonetheless rates Salesforce a “buy,” in part because of the social media efforts.

How Salesforce Tames Twitter for Big Business - BusinessWeek

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