Salesforce soars on big earnings beat

• Eugene Kim
 

• 19h
• 3,471

Salesforce CEO Marc BenioffSalesforce

CRM Salesforce.com

 78.22 -0.58 (-0.70 %)

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Salesforce reported its third quarter earnings on Thursday after the bell.

It's a classic beat-and-raise quarter and Salesforce's stock jumped by as much as 6% in after hours trading.

Here are the most important numbers:

EPS (non-GAAP): $0.24 per share vs. $0.21 per share expected by analysts

Revenue: $2.14 billion vs. $2.12 billion expected by analysts (up by 25% year-over-year)

The results should be viewed as a big positive as there were some concerns around growth stalling due to weaker currency rates. Salesforce also noted weakness in its US sales last quarter, but that doesn't seem to be a problem anymore. It signed a record-number of 7-figure deals in the quarter, Salesforce COO Keith Block said during the earnings call.

This should add momentum to Salesforce's fourth quarter, typically its biggest quarter of the year. Salesforce gave fourth quarter revenue guidance in the range of $2.26 billion to $2.27 billion, exceeding street estimates of $2.24 billion. 

The company also raised its full year revenue guidance to $8.365 billion to $8.375 billion.

Salesforce CEO Marc Benioff said in a statement that the company is on pace to finally hit the $10 billion annual revenue milestone next year, a goal he's set years ago as a priority. 

"I'm delighted to announce that we expect to deliver our first $10 billion year during our fiscal year 2018, which puts us well on the path to reach $20 billion faster than any other enterprise software company," Benioff said.

Salesforce

Operating income (non-GAAP) continued to grow, reaching $273 million this quarter, up 20% from last year. Salesforce has been putting a lot more emphasis on margin expansion in recent years as the company stepped into the next phase of its growth.

The company also noted that there's a backlog of over $12 billion in potential revenue that could be recognized once the contract is invoiced or its service is delivered in the future.

Salesforce had a busy third quarter. Its huge Dreamforce annual conference took place in October, where it revealed its latest new product, Einstein.

It also had to deal with rumors of buying Twitter, a move investors didn't like and drove the stock down by as much as 8%. Benioff was later forced to tell worried investors that he's walking away from the deal to quell investor concerns.

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Tesla shareholders have approved the SolarCity takeover

• Cadie Thompson and Danielle Muoio

• 19h
• 1,956

REUTERS/Beck Diefenbach

Tesla shareholders voted in favor of its acquisition of SolarCity on Thursday.

More than 85% of Tesla shares voted were cast in favor of the acquisition. SolarCity's shareholders also voted in favor.

The deal is worth about $2 billion.

The transaction will be completed in the coming days, Tesla wrote in a press release.

Tesla CEO Elon Musk owns about 20% of both companies and is chairman of SolarCity. Musk is also the cousin of SolarCity's CEO Lyndon Rive.

Musk recused himself from the vote, as did J.B. Straubel, Tesla's chief technical officer who sits on Tesla's and SolarCity's boards.

Tesla will be absorbing SolarCity's roughly $3 billion in debt as part of the merger. Advisory firm Institutional Shareholder Services had recommended shareholders vote in favor of the deal. Analysts were expecting the merger to be approved ahead of the vote. 

One of Tesla's solar roof options. Tesla

In late October, Musk unveiled new solar products to show his vision for a combined company with SolarCity.

The main product was a solar roof that Tesla created in conjunction with SolarCity. Musk showed off four seperate solar roof shingle options, which were made with glass developed by Tesla's new glass division.

Musk claims the roof, which looks like a normal roof, will have the most efficient solar cells at the lowest price. On Thursday after the shareholder vote, Musk said that Tesla aims to get the cost of its solar roof down to the same price as installing a normal roof. 

Musk also unveiled an improved version of Tesla's at-home battery in October. Called the Powerwall 2.0, it can store 13.5 kWh of energy.

Musk is pushing into solar during a potentially difficult time under President-elect Donald Trump, a known climate denier who puts the fate of solar subsidies into question.

Angelo Zino, an equity analyst at CFRA Research, wrote in a Nov.9 research note that a Trump presidency is bad for the solar industry as it could negatively impact solar subsidies.

"We believe a Trump presidency along with a Republican-led Congress poses significant risks to a potential reduction/elimination of the 30% ITC [Solar Investment Tax Credit], extended at the end of '15," Zino wrote.

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China's booming housing market is showing signs of cooling down

• Yawen Chen and Nicholas Heath, Reuters

• 4h
• 1,036

A National Bureau of Statistics (NBS) survey out on Friday showed October's monthly price growth virtually halved to 1.1 percent from September's 2.1 percent, as most of China's first- and second-tier cities posted slowing price growth.

Analysts welcomed the softening as it showed that local and national measures intended to curb speculation were working without seeming to trigger a sharp price correction.

"October data showed the momentum is softening, and that is within market expectations," said Julia Wang, Greater China economist at HSBC global research said in Hong Kong.

"I think that's actually good news since it showed the effectiveness of the new curbs introduced earlier in October without depressing the market too much."

Despite the monthly slowdown, new house prices in China's 70 major cities still rose 12.3 percent in October from a year earlier, accelerating from an 11.2 percent increase in September.

China has depended on a surging real estate market and government stimulus to drive growth this year, but fears of a property market crash have led more than 20 cities to introduce tightening measures to cool overheating markets.

HSBC's Wang said the impact of tightening measures on growth would be "limited" as the policies were still more relaxed than seen in previous tightening cycles, especially without a credit squeeze from monetary tightening.

"We expect monetary policy to remain loose next year," she said.

Wang estimated the property market currently contributed 17 percent of China's total investment, with infrastructure spending still the major driver.

Property investment rose in October on an annual basis to its highest since April 2014, according to Reuters calculations from data issued by NBS on Monday.

Analysts say the impact on real-estate investment from tightening measures is usually delayed, but a property market dampened by sluggish domestic demand could weigh on the economy from early next year, adding uncertainty to the growth outlook.

STRICT RULES TO CONTINUE

Sixty-five of the 70 cities tracked by NBS showed a year-on-year price gain, up from 64 in September. In the second-tier city of Hefei, once again the top price gainer, new home prices rose 48.4 percent in October, quickening from a 46.8 percent surge in September.

Analysts say a record headline figure in October suggests policymakers will maintain measures to bear down on price growth.

"The current strict policy tone will persist, which could add pressure to growth in the coming quarters," said Singapore-based Commerzbank economist Zhou Hao.

Some overheated cities are already beefing up existing measures with stricter multiple curbs, suggesting more cities may follow suit in bolstering controls.

On Tuesday, major cities such as Shenzhen and Wuhan stepped up restrictive measures with fresh curbs on borrowing and purchasing of multiple homes.

(Reporting by Yawen Chen and Nicholas Heath)

Read the original article on Reuters. Copyright 2016. Follow Reuters on Twitter.

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The euro is on a record losing streak

BEN MOSHINSKY

NOV 18, 2016, 7:49 PM   

The euro is falling for the 10th consecutive trading session, marking the currency’s longest losing streak since it was created in 1999, according to analysis by the Financial Times.

The euro is down 0.26% as of 8:44 a.m. (3:44 a.m. ET) at $1.0593. It’s the first time since December 3 last year that the euro has traded below $1.06.

Markets Insider

The dollar is getting stronger. The US dollar index climbed to 13-and-a-half year high.

The number of Americans filing for unemployment benefits fell to a 43-year low last week, pointing to a rapidly tightening labour market that could allow the Federal Reserve to raise interest rates next month, strengthening the currency.

The Federal Reserve could raise U.S. interest rates “relatively soon” if economic data keeps pointing to an improving labour market and rising inflation, Fed Chair Janet Yellen said on Thursday in a clear hint the U.S. central bank could hike next month.

Yellen said Fed policymakers at their meeting earlier in November judged that the case for a rate hike had strengthened.

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---

5 signs you're CEO material

• Jessica Stillman, Inc.

• Nov. 16, 2016, 1:20 PM
• 145,737

CEOs, like Facebook's Mark Zuckerberg, are made, not born.Justin Sullivan/Getty

Are CEOs born or made? According to entrepreneur-turned-top venture capitalist Ben Horowitz, most of the tricky skills needed to excel are drummed into leaders through years of experience.

Likening critical CEO capabilities, such as giving difficult feedback, to learning the unnatural motion of lifting your back foot first in boxing, he claims "it generally takes years for a founder to develop the CEO skill set." In short, Horowitz insists CEOs are made, not born.

But just because becoming an exceptional leader takes a whole lot of practice, it doesn't mean everyone can become a CEO through hard work. While you invite disappointment if you believe some people are simply naturals at the job, you invite years of wasted effort if you don't also acknowledge that certain fundamental mindsets are a prerequisite for getting started on this long path of learning.

What are they? Experts suggest you need to nail these basics before you can even start to think of yourself as potential CEO material.

View As: One Page Slides

Sundar Pichai is the CEO of Google.AP

1. You're curious and a constant learner.

The first tip-off that a commitment to continual self-improvement is key to leadership success is the fact that nearly every business icon you can think of--from Warren Buffett and Bill Gates to Oprah Winfrey--describes him- or herself as a perpetual learner. But if you want more quantitative backing for this idea, it exists too.

According to The New York Times, research shows that you're more likely to reach the top of an organization if you've had a variety of roles, from finance to marketing, rather than hunkered down and built expertise in just one department where you felt comfortable.

"Evidence suggests that success in the business world isn't just about brain power or climbing a linear path to the top, but about accumulating diverse skills and showing an ability to learn about fields outside one's comfort zone," writes the paper's Neil Irwin.

Mary Barra is the CEO of General Motors.Daniel Roland/Stringer/Getty Images

2. You're willing to feel like you're the dumbest person in the room.

Are CEOs smart? Sure, running a company takes a certain degree of intelligence. But for top leaders, the ability to gather and listen to exceptional brains is more important than personal mental horsepower. Great leadership involves enough humility to respect others' gifts and enough confidence to reveal your own limitations and accept their help.

Or as entrepreneur Kevin Johnson cleverly put it, you need to be OK with sometimes feeling like you're the dumbest person in the room. "The average person is intimidated by smart people ... If given a choice to spend a week quarantined with really smart people or people of average intelligence, the average Jane would choose people of average intelligence," he writes.

If you're CEO material, however, you'll put learning and results before ego and surround yourself with the truly brilliant. It's why Johnson is always looking to make a super smart friend. "They make me feel inadequate and sometimes just really stupid, but I am OK with that, because I know that I learn so much from them," he explains.

Indra Nooyi is the CEO of PepsiCo.Joe Raedle/Getty Images

3. You can know a dream is crazy, but chase it anyway.

How does Elon Musk, leader of some of the world's most long-shot ventures, deal with risk? He doesn't ignore it. In fact, he recently told an interviewer that he's absolutely terrified by the huge risks inherent in pursuing borderline insane projects such as Mars colonization. "I feel fear quite strongly," he reported.

But faced with terrible odds, he doesn't resort to irrational optimism. He acknowledges the likelihood of failure and accurately assesses the long list of risks he's facing, but then he proceeds anyway. "When starting SpaceX, I thought the odds of success were less than 10 percent, and I just accepted that actually probably I would just lose everything. But that maybe we would make some progress," he continued.

This odd coupling of open-eyed risk assessment and a willingness to dare anyway is a hallmark of great CEOs, according to Robert Scoble, who studies CEOs for Rackspace. The ideal CEO, he wrote on Quora, is "assured of the achievability of long-term goals yet nervous about the attainability of near-term milestones. This schizophrenic mindset ensures that an entrepreneur maintains an unyielding belief in the manifestation of their vision while never taking for granted the execution of their startup's most basic tasks."

Tim Cook is the CEO of Apple.Getty Images/Andrew Burton

4. You tend to get obsessed.

Some call this quality passion. Others refer to it as focus. But whatever term you want to use, being a great CEO requires the ability (if not an inborn compulsion) to latch onto interesting questions or problems, shut out distractions, and work relentlessly until you have a solution.

As a young programmer, Bill Gates, for instance, was famed for working at his keyboard until he nodded off, still sitting up. When he woke, he simply looked up, oriented himself for a few seconds, and began working away again. GoPro CEO Nick Woodman pursued his dream of a better surf video obsessively, through months of intense experimentation.

Perhaps Dropbox founder Drew Houston described this quality best, using the metaphor of a tennis ball. "The tennis ball is about finding the thing you're obsessed with," he said. "The most successful people and successful entrepreneurs I know are all obsessed with solving a problem that really matters to them. I use the tennis ball for that idea because of my dog, who gets this crazy, obsessed look on her face when you throw the ball for her."

Do you get a crazy look in your eye when you spot a problem in need of solving?

Meg Whitman is the CEO of Hewlett Packard.Flickr/HP/HP Deutschland

5. You can tell a captivating story.

You want to run a business, not write a hit TV show, so why is the ability to tell a great story so important to success as a CEO? Because humans are renowned for their imperviousness to logic (just look at basically any political discussion, if you need proof). If you want to change minds and convince people to follow you, you're going to need to appeal to emotion. And nothing arouses our emotions as much as a great tale.

"CEOs have to deal with conflicting interest groups," said Scoble. "Customers often want something investors don't. So a good CEO is really great at convincing other people to get on board, even at changing people's opinions."

Read the original article on Inc.. Copyright 2016. Follow Inc. on Twitter.

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Retail sales just smashed forecasts and the pound popped

• Oscar Williams-Grut
 

• 5h
• 252

REUTERS/Peter Nicholls

LONDON — October retail sales smashed expectations on Thursday, with monthly growth coming in at 1.9% against a forecast of just 0.4%.

Annually consumer sales in Britain jumped a huge 7.4%, the Office for National Statistics (ONS) said, beating forecasts of a 5.4% increase in goods shifted. It is the biggest annual growth recorded since April 2002.

Brits spent £30.8 billion in the 4 weeks of October, 2.1% more than in September and 6.6% more than was spent in October 2015.

All shops, bar department stores, benefited from the uptick in sales in October, the ONS said. The bulk of the growth came from increased sales of clothing, shoes, and textiles.

The ONS says:

"The underlying pattern in the retail industry continues to show strong growth with the 3 month on 3 month movement in the quantity bought increasing by 1.9%; this is the 34th consecutive period of 3 month on 3 month growth."

The figures represent a big acceleration from September's figures, which showed not monthly sales growth despite hopes of a back to school bounce and annual growth of 4.1%. However, September's figures were also revised up slightly on Thursday, with monthly growth of 0.1% and annual growth now pegged at 4.2%.

The pound popped against both the dollar and the euro when the figures were announced at 9.30 a.m. GMT (4.30 a.m. ET):Investing.com

Investing.com

However, the pound's rally against the euro was shortlived and it was back in negative territory against the currency 15 minutes after the sales figures came out. The pound has been down against the euro for most of Thursday morning:Investing.com

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