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A Strong Showing for

Shares of the software outfit soared Thursday after its profits handily beat Street estimates. But a weakening economy could slow its momentum

The outsourcing of information technology management functions by businesses has been a boon for on-demand software providers such as (CRM). But the likelihood of the U.S. economy slipping into recession this year could put a snag in Salesforce’s ability to keep growing as rapidly as it has been, some analysts say.

After the market close on Feb. 27, the San Francisco-based company reported earnings under generally accepted accounting principles (GAAP) of six cents per share for the fourth quarter of fiscal 2008, vs. breakeven in fiscal 2007, on a 50% rise in revenue. The results for the latest quarter, which ended on Jan. 31, included about $16 million in stock-based compensation and roughly $1.3 million in amortization of purchased services related to acquisitions announced earlier.