SaaS sultan Salesforce has announced a new CEO: Bret Taylor, previously the company’s president and chief operating officer.
Taylor co-created Google Maps, served as Facebook’s chief technology officer from 2009 to ’20, and came to Salesforce after it acquired his cloudy document collaboration company Quip. Co-CEO is Taylor’s second new job this week: he was also elevated from a mere board member at Twitter to become the avian network’s president.
Salesforce has had dual CEOs before – Keith Block shared the gig with founder Marc Benioff from 2018 to ’20. On the company’s earnings Q3 earnings call on Tuesday, Benioff reminded investors of that history and that the arrangement worked rather well.
Operating with a single CEO also seems to work just fine – Salesforce posted Q3 revenue of $6.86 billion, up 27 per cent year-over-year.
One of Taylor’s first acts as co-CEO was tweeting revenue guidance reflecting that growth.
2023 $31.8B (guidance)
2022 $26.4B (guidance)
Thank you to our Trailblazers and all our stakeholders!
— Bret Taylor (@btaylor) November 30, 2021
The company’s Sales Cloud delivered 17 per cent year-on-year growth and is a $6 billion business. The Commerce Cloud and Marketing Cloud each grew 25 per cent year-over-year.
Slack was anything but in its first quarter as a Salesforce company. Revenue reached $280 million – $30 million ahead of guidance.
Taylor revealed that Salesforce’s adoption of the tool for internal communications has reduced emails by 46 per cent.
Benioff attributed Salesforce’s robust performance to being built for the times – the pandemic drove accelerated demand for the company’s products, and saw more companies go digital, which generated more ongoing demand.
The co-CEO also revealed that COVID gave Salesforce the chance “to really look at how are we spending money overall”. “We were really taken by changes in the pandemic cycle: T&E [Travel & entertainment], the use of our real estate, our marketing spend,” he said. “And we started to rebalance, to reshape, to rethink about how do we look at our model, our overall model, not just our revenue model, but our expense model.”
CFO Amy Weaver said the result was “a heightened sense of discipline” that’s seen teams within the business find and make savings – apparently without complaint. Those efforts helped improve overall results and contributed to improved guidance Taylor tweeted – plus a prediction that operating margin will grow to 18.6 per cent.
Net income was a rare soft metric. At $468 million, it’s down from $1.08 billion for the same quarter last year. ®