Salesforce reported its Q4 and full-year earnings this week, and as a leading tech bellwether and the industry's largest pure SaaS vendor, it's always worth paying attention. While the raw numbers provide fodder for Wall Street analysts, Constellation is more interested in the colorful details that often arise during Salesforce's earnings conference call. Here's a look at the highlights from the latest installment.
Big news coming?: Salesforce will hold a global webcast on March 7 from its new building in San Francisco, and has significant announcements to make, CEO Marc Benioff said:
[I]f you can come to March 7, you're going to see some amazing customer announcements, product announcements, partnership announcements, and we have got some incredible stuff to talk to you about.
[Y]ou're going to also see the latest in what we're talking about with Einstein, with our spring and summer 2017 product releases. And some of our largest customers are going to be there as well talking about some of their expansions, some that we're talking about on the call here and others that we're holding until March 7.
Industry action: Salesforce launched an industries strategy in 2014, announcing its intentions to go after six verticals including financial services and insurance, health care and life sciences, retail and consumer products, communications and media, automotive/manufacturing and public sector. As of today the strategy is humming along nicely, said President Keith Block:
We had strong growth in Q4 in all of our target industries. In fact, the largest deal in the quarter was a massive expansion with one of the world's leading CPG brands based in Europe using Marketing Cloud, Sales Cloud and Service Cloud to deliver personalized consumer experiences.
And just a quick update on Financial Services Cloud and Health Cloud. It's been less than a year since they've been GA and we've already seen great traction. In fact, more than 70% of customers who have purchased one of these industry solutions are net new logos to Salesforce in this fiscal year.
Eyes on Einstein: Unsurprisingly, next week's event will prominently feature Einstein, Salesforce's broad-based AI and machine learning technology. It's still being baked into the company's various clouds, but in the meantime the more Einstein use cases Salesforce can show customers, the better. One interesting one will be showcased at the March 7 event, as Benioff revealed:
[W]e had a call from a major customer of ours. They're a CPG company and they have a big issue. ... They want to know if competitive products are ending up in their shelves, which is supposed to be merchandised only with their own proprietary products.
So we showed them just by using a cell phone camera and using Einstein and our deep learning capabilities which have benchmarked ... they're able to do real-time inventory analysis of their retailer shelves and they're able to, based on that analysis that's happening from those cameras, understand the competitive environment, number one. Number two, understand their own environment, and number three, when they are seeing a level of depletion on the shelves that they want to replace, they can just roll trucks automatically using Salesforce Einstein.
Salesforce next week will feature several customers who closed "extremely large transactions" with it in the quarter, with Einstein being a big reason for it, Benioff added.
Go here to read an in-depth blog post on Salesforce Einstein's road map and strategy by Constellation Research VP and principal analyst Doug Henschen.
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