As we reflect back on the just completed Q4 sales software sector earnings season, we dig into the relative performance of Salesforce (NYSE:CRM) and its peers.
Companies need to be able to interact with and sell to their customers as efficiently as possible. This reality, coupled with the ongoing migration of enterprises to the cloud drives demand for cloud-based customer relationship management (CRM) software that integrate data analytics with sales and marketing functions.
The 4 sales software stocks we track reported a slower Q4; on average, revenues beat analyst consensus estimates by 3.33%, while on average next quarter revenue guidance was 0.39% under consensus. Tech multiples have reverted to the historical mean after reaching all time levels in early 2021 , but sales software stocks held their ground better than others, with the share prices up 3.03% since the previous earnings results, on average.
Best Q4: Salesforce (NYSE:CRM)
Launched in 1999 from a rented one-bedroom apartment in San Francisco by Marc Benioff and his three co-founders, Salesforce (NYSE:CRM) is a software as a service platform that helps companies access, manage and share sales information.
Salesforce reported revenues of $8.38 billion, up 14.4% year on year, beating analyst expectations by 4.9%. It was a decent quarter for the company, with a decent beat of analyst estimates but underwhelming guidance for the next year.
“For the full year we delivered $31.4 billion in revenue, up 18% year-over-year, or 22% in constant currency, one of the best performances of any enterprise software company our size,” said Marc Benioff, Chair and CEO of Salesforce.
Salesforce scored the highest full year guidance raise but had the slowest revenue growth of the whole group. The stock is up 17.3% since the results and currently trades at $196.16.
Is now the time to buy Salesforce? Access our full analysis of the earnings results here, it's free.
HubSpot (NYSE:HUBS)
Started in 2006 by two MIT grad students, HubSpot (NYSE:HUBS) is a software as a service platform that helps small and medium-size businesses sell, market themselves, and get found on the internet.
HubSpot reported revenues of $469.7 million, up 27.2% year on year, beating analyst expectations by 5.3%. It was a mixed quarter for the company, with a solid beat of analyst estimates but underwhelming guidance for the next year.
HubSpot delivered the strongest analyst estimates beat among its peers. The company added 8,481 customers to a total of 167,386. The stock is up 15.7% since the results and currently trades at $419.89.
Is now the time to buy HubSpot? Access our full analysis of the earnings results here, it's free.
ZoomInfo (NASDAQ:ZI)
Founded in 2007 as DiscoveryOrg and renamed after a merger in 2019, ZoomInfo (NASDAQ:ZI) is a software as a service product that provides sales departments with access to a database of prospective clients.
ZoomInfo reported revenues of $301.7 million, up 35.7% year on year, in line with analyst expectations. It was a weak quarter for the company, with full-year revenue guidance missing analysts' expectations.
ZoomInfo achieved the fastest revenue growth but had the weakest performance against analyst estimates and weakest performance against analyst estimates in the group. The company added 78 enterprise customers paying more than $100,000 annually to a total of 1,926. The stock is down 13.7% since the results and currently trades at $24.82.
Read our full analysis of ZoomInfo's results here.
Freshworks (NASDAQ:FRSH)
Founded in Chennai, India in 2010 with the idea of creating a “fresh” helpdesk product, Freshworks (NASDAQ: FRSH) offers a broad range of software targeted at small and medium sized businesses.
Freshworks reported revenues of $133.2 million, up 26.3% year on year, beating analyst expectations by 2.18%. It was a slower quarter for the company, with revenue guidance for the next quarter and the full year missing analysts' expectations.
The company added 1,009 enterprise customers paying more than $5,000 annually to a total of 17,722. The stock is down 7.14% since the results and currently trades at $15.22.
Read our full, actionable report on Freshworks here, it's free.
The author has no position in any of the stocks mentioned