NEW YORK (AP) -- Shares of Salesforce.com Inc. tumbled in premarket trading Friday after the company said its losses widened as it spent more money to expand its online software service in an effort to maintain its rapid growth.
The results announced late Thursday largely fell in line with analysts' estimates, as did Salesforce's forecast for the current quarter and the rest of the fiscal year. But investors evidently were still disappointed.
Salesforce shares dropped almost 7 percent with 75 minutes left before Friday's opening bell.
Analysts for Citi, Jefferies and Roth Capital Partners all backed "Buy" ratings for Salesforce's stock, saying that while the quarterly results and guidance weren't spectacular, the company's growth prospects remain strong.
Roth's Nathan Schneiderman said the quarter's major disappointment was its "soft" billings growth of 17 percent, which represented a significant drop from the previous quarter's 28 percent growth. But Schneiderman said he said he remains positive about the stock.
Jefferies' Ross MacMillan noted that excluding certain factors, Salesforce's billings grew at a "respectable" rate of 27 percent. He added that the company faces easier comparisons in the second and third quarters of this year.
Wall Street has become accustomed to more stellar performances and more aggressive forecasts from Salesforce.com. The company emerged as a stock market and technology star by winning over more corporate converts to its method of selling software in monthly subscription packages instead of charging a big upfront fee to install the programs on individual computers kept in a customer's office.
Since its initial public offering nine years ago, Salesforce's success has helped it stock increase by 15-fold.
In premarket trading, Salesforce shares fell $3.15, or 6.9 percent, to $42.54.
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