On Wednesday, JMP Securities sustained its Market Outperform rating and a $450.00 price target for Salesforce.com (NYSE:CRM) stock, following the company's release of its third-quarter fiscal year 2025 earnings. The report showed that Salesforce achieved most of its financial expectations, with a non-GAAP EPS of $2.41.
This figure slightly missed the consensus estimate of $2.44, which the firm attributed to an $0.18 charge related to 'mark-to-market adjustments of our strategic investment portfolio'.
Despite this, Salesforce's non-GAAP operating margin reached 33.1%, surpassing the consensus prediction of 32.3%. InvestingPro analysis reveals the company maintains impressive gross profit margins of 76.35% and has achieved a perfect Piotroski Score of 9, indicating exceptional financial strength.
Salesforce's revenue for the quarter was $9.44 billion, which exceeded the anticipated $9.35 billion and represented an 8% year-over-year increase, consistent with the previous quarter's performance. Subscription revenue also showed strong results at $8.88 billion, topping the consensus of $8.81 billion, and marking a 9% year-over-year rise, which was in line with the last quarter's figures.
The company's robust performance is reflected in its "GREAT" financial health score on InvestingPro, which offers 16 additional ProTips and comprehensive analysis for subscribers.
The company's current Remaining Performance Obligations (RPO), which indicate future revenue, totaled $26.4 billion. This figure beat the consensus estimate of $26.1 billion and showed a 10% year-over-year growth, mirroring the flat trend observed in the previous quarter. Following the earnings release, Salesforce's stock experienced an 11% increase in aftermarket trading.
The stock's performance has been robust throughout the year, with a 26% rise year to date, matching the 26% increase seen in both the S&P 500 and the Russell 3000 indices.
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