Salesforce.com, Inc. Earnings: Right on Point

Based on analyst estimates, the Street wasn't expecting Salesforce.com to report many surprises, good or bad. Consensus estimates matched those of Salesforce.com following its fiscal 2015 Q3 results announced in November. Revenues were expected to be $1.436 billion this quarter, and non-GAAP earnings per share (excluding one-time expenses) were set to come in at $0.13 per share to $0.14 per share.

Continually increasing operating and infrastructure expenses, along with integrating a few acquisitions, were anticipated. To date, investors appear to have taken Salesforce.com CEO Marc Benioff at his word: Today's investments will drive tomorrow's growth. And analysts can see some light at the end of Salesforce.com's tunnel as well, based on its target price of nearly $69 a share. Would Salesforce.com light a fire under investors, or come in as expected? Turns out, it did both.

Just the factsGenerally, a nearly 8% pop in share price in after-hours trading within 15 minutes of announcing earnings is an indication that a company pleasantly surprised investors. Turns out Salesforce.com delivered as promised in last quarter's Q4 and fiscal 2015 forecast, and that was more than enough to jump-start the stock-buying spree.

Fiscal Q4 revenue was $1.44 billion, spot-on with Salesforce.com's expectations, as was its full-year revenue of $5.37 billion. Both quarterly and annual revenue results were well above last year's, by 26% and 32%, respectively.

Benioff and team also delivered quarterly earnings per share that met guidance, and analyst forecasts, of negative-$0.10 per share on a GAAP basis and $0.14 a share on a non-GAAP basis. Deferred revenue, a key metric for Salesforce.com, turned in a solid year-over-year increase, rising 27% to an estimated $5.7 billion.

As expected, overhead costs climbed compared with fiscal 2014's Q4 and the year, but perhaps not quite as much as some investors had braced themselves for. Total operating expenses last quarter climbed onlyabout $150 million -- not bad, considering Salesforce.com generated $300 million more in revenue. Annually, the impact of spending was a different story. Largely because of increased sales costs, fiscal 2015 operating costs increased nearly $1 billion.

Finally, Salesforce.com also included a note that it's raising its earlier fiscal 2016 revenue forecast and now expects $6.475 billion to $6.52 billion in sales this year -- about a 20% improvement from 2015's sales results.

Going forwardBased on hitting all of its objectives, and despite the ongoing impact of overhead on GAAP earnings, Salesforce.com appears to be pointed in the right direction. Recent alliances with industry heavyweights such as Microsoft could prove to be a boon for Salesforce.com by expanding its suite of cloud-based offerings, and opening the door to Microsoft's bevy of Office 365 customers. Of course, Microsoft also happens to be one of the fastest-growing cloud solution providers around and is currently tracking at $5.5 billion in annual sales.

Nevertheless, it should help both cloud leaders in their respective efforts in one of the fastest-growing markets in technology. Expansion in the fast-growing European markets is expected to begin paying dividends this year, as Salesforce.com completes the construction of several data centers.

And global expansion is a significant opportunity for Salesforce.com. As it stands, last quarter almost $1.1 billion of Salesforce.com's $1.44 billion in total revenues was generated from the Americas. Europe was second with $254.6 million, and the Asia-Pacific region brought up the rear with $134.4 million. Would additional geographic revenue diversity have been nice to see? You bet, and all three areas still make up the same percentage of total sales, as each did in fiscal 2014, and therein lies the opportunity.

The positive after-hours response from traders was as it should be. No, Salesforce.com didn't blow away analyst expectations, but remember: Its forecasts were already well above the prior year's results. As for this fiscal year, Benioff put it this way: Becoming the fastest-growing software company to $5 billion in sales -- which Salesforce.com just accomplished -- is just the beginning.

The article Salesforce.com, Inc. Earnings: Right on Point originally appeared on Fool.com.

Tim Brugger has no position in any stocks mentioned. The Motley Fool recommends Salesforce.com. Try any of our Foolish newsletter services free for 30 days. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy.