When Salesforce announced on its most recent earnings call that it wouldn’t provide a revenue forecast for next year, which was a shock, especially coming from the most successful SaaS company in the world.
With over $7.8 billion in revenue for the quarter and target reach $50 billion in fiscal year 2026, the company is not really underperforming. However, when you combine the lack of forecasting with recent executive exodusit began to paint a picture of unusual instability at the CRM giant.
First, consider that forecast – or lack of one. It seems the economy has become so uncertain that Salesforce has opted out of projections for fiscal year 2024 (the three months ending October 31, 2022, including the third quarter of fiscal 2023). of the company). We use the word never happend a lot these days, but it’s unusual for a company like Salesforce to tell investors it’s making forecasts, and this is the first time the CRM giant has done it.
Here’s What Salesforce CFO Amy Weaver Tells Investors in earnings call:
Before we close, I would like to share a few thoughts on Fiscal Year ’24. As discussed, we are experiencing a very unpredictable macro environment, as our clients are working hard to ensure their business also thrives in the long term. Combined with that dynamism is an unprecedented foreign exchange market. Therefore, at this point, we think it’s too early to give revenue guidance for the next fiscal year.
That’s enough to make anyone who has followed this company raise an eyebrow. But consider that Salesforce dropped that bomb at the same time Co-CEO Bret Taylor plans to step down.
On the surface, the reason for that departure was that Taylor was tired of life in the big corporation and wanted to return to her roots as a company builder – in other words, back to the things that mattered. basic. But that might not be whole story. The The Wall Street Journal reported tension between the two leaders and the resignation may not come from the left as we believe. (You might gasp in astonishment; this isn’t the first time a company has tried to turn bad news into neutral.)
There are other shoes left to drop. Mark Nelson, CEO of Tableau, announces he went. (Sales force acquired Tableau in 2019). More dramatic news quickly followed: Slack Co-Founder and CEO, Stewart Butterfield tell your flock that he wants to spend less time running the business and more time gardening and taking care of the children.
Slow down quickly announced that Lidiane Joneswho was the GM of Salesforce’s Commerce Cloud, Marketing Cloud, and Experience Cloud (yes, that’s a lot of clouds), will replace Butterfield.
Don’t forget that even before all this, Salesforce had to deal with activist investor The right breath value slopes down the neck, never a comfortable position. (The company emphasizes its cost-cutting efforts in latest quarterly callremarkable.)
In theory, that sounds like a bunch of unsettling news for a short period of time. But what does it mean for the company’s underlying financial stability? As part of our year-end roundup at TechCrunch+, we decided to take a close look and see what’s going on. Is this a short-term hiccup in a bad year for all SaaS companies, or could a flurry of moves be a sign of something more worrisome at Salesforce?
Inside the numbers
We have three goals: First, look at Salesforce’s recent quarterly performance to see what we can infer about its health. Second, to wonder if other companies are reporting similar results and forecasts. And, third, to ask if there are any lessons here for us tech watchers, especially about startups.
