Salesforce Revenue Forecast Tops Estimates Inc. issued a fiscal third-quarter sales and earnings forecast that topped analysts’ estimates as the largest seller of customer-management software adds marketing tools to its lineup.

Revenue for the period ending in October will be $1.05 billion to $1.06 billion and profit excluding some items will be 8 cents to 9 cents a share, the company said in a statement today. That compared with analysts’ average estimate for profit of 7 cents on sales of $1.04 billion, according to data compiled by Bloomberg. The company raised full-year guidance and shares rose in extended trading.

Chief Executive Officer Marc Benioff is adding online-marketing software to his sales and customer-support products as he seeks to expand beyond $4 billion in sales this year. Salesforce last month closed its $2.5 billion acquisition of ExactTarget Inc. -- the San Francisco-based company’s biggest ever -- to add tools for e-mail marketing by businesses.

“More and more IT budget dollars will flow to the chief marketing officer over time and has decided to target that person,” said Steven Ashley, an analyst at Robert W. Baird & Co., who has an outperform rating on the shares, the equivalent of a buy. “Marketing generates leads and hands them to sales, then they become customers and need service.”

Salesforce rose as much as 8.7 percent in extended trading after closing up 2 percent at $43.65 in New York. The stock has climbed 3.9 percent this year, trailing the 9.5 percent return of the Standard & Poor’s 500 Information Technology Index.

Integrating Acquisitions

For the fiscal second quarter through July, sales rose 31 percent to $957.1 million, compared with analysts’ average estimate for $938.9 million. Profit excluding some items was 9 cents a share, compared with analysts’ 7-cent projection.

Salesforce reported net income of $76.6 million, which included a $133.4 million tax gain. Analysts had predicted a $90 million loss.

“In terms of foreseeing the future and making the right bets, Benioff’s truly been vindicated,” said Pat Walravens, an analyst at JMP Securities LLC, who has a market outperform rating on the shares, the equivalent of a buy.

Billings, a measure of the amount Salesforce invoiced customers during the quarter, increased 31.7 percent to $966.9 million, compared with analysts’ average estimate of $937 million.

Salesforce raised its full-year sales forecast to $4 billion to $4.03 billion, from $3.96 billion to $4 billion.

Cloud Vendor

Benioff is expanding Salesforce’s presence in online software that companies pay to use on an annual basis, getting regular updates and new features, instead of installing programs on personal computers and servers.

The company’s “current valuation does not give full credit to Salesforce’s status as the largest pure-play software-as-a-service vendor,” Brent Thill, and analyst at UBS AG, wrote in an Aug. 13 note to clients. The company “has shown a good track record of integrating acquisitions and providing execs of acquired companies with significant responsibilities,” he said.

ExactTarget helped to lift Salesforce’s revenue result and outlook, although Benioff probably had to pay a premium to buy the company, a provider of e-mail marketing tools that companies such as Nike Inc. and Gap Inc. covet, Walravens said.

“This is one area where it took him a while to figure it out, and as a result, he had to pay more money than we probably would have liked,” Walravens said.

Growth Push

In addition to ExactTarget, Salesforce has bought social-media marketing companies Buddy Media Inc. for $689 million last year, and Radian6 Technologies Inc. for $326 million in 2011. When Salesforce announced the ExactTarget deal in June, Benioff told analysts buying smaller companies was taking too long to tack on revenue.

Benioff is competing in the cloud-computing software market with companies including Oracle Corp., SAP AG and Workday Inc. Oracle CEO Larry Ellison in June hosted a conference call with Benioff as the companies mended fences. Salesforce signed a long-term deal to use Oracle’s software and Exadata computers, and Oracle began using Salesforce’s customer-management software. A former Ellison deputy, Benioff later became a competitor in in the customer-relationship software space.

Salesforce surpassed SAP this year as the top seller of customer-relationship management software, according to market researcher Gartner Inc. In June, Salesforce hired Keith Block, a former Oracle sales executive, as president and vice chairman.

Salesforce plans to hold its annual Dreamforce user conference in San Francisco from Nov. 18. Speakers include Yahoo! Inc. CEO Marissa Mayer and Facebook Inc. Chief Operating Officer Sheryl Sandberg, according to Salesforce’s Web site.

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