Salesforce Gains Momentum from Cloud Platform and Marketplace Drives Growth in Ecommerce for Etsy
After the closing bell on Wednesday, August 25, Salesforce.com, Inc. (#salesf) beat earnings estimates with its fiscal second-quarter 2022 earnings release. On the top line, revenues of $6.34 billion exceeded expectations of $6.25 billion. On the bottom line, adjusted earnings per share of $1.48 exceeded expectations of $0.93 per share.
“With companies and governments around the world continuing to accelerate their digital transformations, we delivered our fifth phenomenal quarter in a row,” said Marc Benioff, Chair & CEO, Salesforce. “Salesforce has never seen better execution or greater momentum. Our Customer 360 platform is now fueled by a herd of unicorns perfectly designed for this all-digital world. Sales, Service, Marketing & Commerce, Platform, Tableau, MuleSoft and now Slack are all billion dollar-plus products delivering customer success like no other company.”
Breaking down the headline number segment results, on a year over year basis, Subscription and support revenue climbed to $5.91 billion and Professional services and other revenue came in at $0.43 billion.
Looking ahead, Salesforce now sees $4.36 to $4.38 in adjusted earnings per share and $26.2 billion to $26.3 billion in revenue. The company projected that its operating margin for the fiscal year would be 1.8%, wider than the 1.4% guidance from the previous quarter.
Shares of Salesforce have risen 22% this year.
After the closing bell on Thursday, August 4, Etsy (#etsy) topped earnings estimates with its fiscal second-quarter 2021 earnings release. On the top line, revenues of $528.90 million exceeded expectations of $525.70 million. On the bottom line, adjusted earnings per share of $0.87 exceeded expectations of $0.74 per share.
CEO Josh Silverman stated, “ We’re demonstrating just how many purchase occasions Etsy sellers can meet in truly delightful ways, attracting millions of new buyers and engaging our customers more than ever before. We’re seeing measurable results from deepened investments in our ‘Right to Win’ strategy, which provides a clear roadmap for product and marketing investments to make it easier to shop on Etsy, build top of mind awareness, and solidify buyer trust.”
“In the second quarter we also announced two strategic acquisitions, both completed in July,” continued Mr. Silverman. “Depop and Elo7 further extend our total available market opportunities in resale, a large and fast-growing apparel segment, and in Brazil, Latin America’s largest ecommerce market. In addition to driving growth in our core Etsy.com marketplace, we are now focusing on integrating these exciting businesses into our ‘House of Brands.
Breaking down the headline number segment results, on a year over year basis, Marketplace revenue was up to $395.5 million. Services revenue rose to $133.4 million.
Looking ahead, Etsy marketplace anticipates mid-single digit GMS growth and mid-teens growth in GMS excluding facemasks. These growth levels continue to represent strength in the business and Etsy’s ability to attract and engage buyers as we compare to the above e-commerce sector growth Etsy reported last year.
Shares of Etsy have risen 19% this year.
I am not a financial advisor and my comments should never be taken as financial advice. Investments come with risk, so always do your research and analysis beforehand.