Oracle and SAP-Supremely confident that its revenue will top $20 billion in calendar 2020, Salesforce this week laid out how it intends to stay far ahead of rivals Oracle and SAP in the SaaS market and reach a staggering $35 billion in revenue by 2024.
At its Dreamforce Investor Day presentation, Marc Benioff’s company laid out in bold strokes the market dynamics and internal plans that it says will allow it to double its revenue in a 4-year span from $17 billion for fiscal 2020 (ending Jan. 31, 2020) to $35 billion for fiscal 2023 (ending Jan. 31, 2024).
Here’s what such an achievement would look like, per the investor presentation:
While both SAP (#4 on the Cloud Wars Top 10) and Oracle (#5 on the Cloud Wars Top 10) have aggressive growth plans for their cloud businesses, it’s hard to imagine how either company could come close to matching the trajectory Salesforce has laid out for itself.
Salesforce will finish calendar 2019 with close to $17 billion in cloud revenue. SAP expects to reach $7 billion and Oracle is estimated to be close to that number. So for either Oracle or SAP to reach $35 billion by the end of 2023, they’d have to grow current cloud revenue by 400% over that 4-year span.
For Salesforce to do so, it has to grow by “only” 100% over that time.
So what makes Salesforce think it can pull this off? Why does it believe it can sustain growth rates of 20% and more, even as its annual revenue jumps past $20 billion to $25 billion and even $30 billion?
The entire Investors Day presentation is quite compelling, and I’d urge you to give it a look. But because I love you all so much, I’ve pulled out some of the most significant slides and have packaged them below to give you the strategic overview. Here’s the basic framework, and the slides will follow:
- Digital Transformation will continue to drive higher levels of spending
- Salesforce has and continues to have first-mover status in key segments
- The philosophy of “put the customer at the center” is paying big dividends
- Salesforce’s CRM market share is almost as big as the combined total of the CRM shares for Oracle, SAP, Microsoft and Adobe