Salesforce Climbs, First Solar Falls as Stock Markets Look to Recover

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EVents around the world are moving at a breakneck pace and investors in many different financial markets are seeing extreme swings as a result. Oil prices hit nearly $110 a barrel early Wednesday morning as traders assess the impact of Russian sanctions on global energy production and supply. However, stock markets have sought to regain ground after heavy losses in recent days. Starting at 7:30 a.m. ET, futures on the Dow Jones Industrial Average (DJINDICES: ^DJI) rose 240 points to 33,507. S&P500 (SNP INDEX: ^GSPC) futures gained 31 points to 4,335, while Nasdaq Compound (NASDAQ INDEX: ^IXIC) futures gained 113 points to 14,118.

Earnings reports continued to add some color to the performance of individual companies across the broader US economy. Pioneer of customer relationship management software Salesforce.com (NYSE: CRM) posted solid gains after releasing its latest results, while First Solarit’s (NASDAQ: FSLR) the numbers cast a shadow over the solar panel producer.

Salesforce posts record sales

Salesforce shares were up 4% in premarket trading Wednesday morning. The CRM software specialist’s fourth quarter financial results showed the continued impact of digital transformation on companies that provide vital services to help businesses adopt and take advantage of the latest technologies.

Salesforce ended its 2022 fiscal year on a high note. Fourth quarter revenue of $7.33 billion increased 26% year over year, with 25% growth in subscription and support revenue complemented by an outsized 46% increase % of sales of professional services. For the full year, revenue was nearly $26.5 billion, up 25% from fiscal 2021. Adjusted earnings were $0.84 per share for the quarter and at $4.78 per share for the full year.

Salesforce also continued to see a healthy pipeline of future business. Remaining performance bonds climbed 21% to $43.7 billion, more than a year and a half of revenue.

Even better, Salesforce sees its momentum continuing through fiscal 2023. The company raised its revenue forecast, now expecting 21% growth to between $32 billion and $32.1 billion. Adjusted annual earnings of $4.62 to $4.64 per share would mark a slight decline from fiscal 2022 levels, but investors seem to be hoping that between favorable trends like remote working and the acquisition recent release from workplace communications platform Slack Technologies, Salesforce could see higher longer-term profits in the coming years.

Image source: Getty Images.

The sky darkens on First Solar

Elsewhere, Wednesday morning did not bring such a sunny outlook from First Solar. The solar giant saw its stock plunge 13% after its fourth-quarter financial results failed to give investors everything they hoped to see.

First Solar’s numbers didn’t seem alarming at first glance. Fourth-quarter revenue of $907 million increased 49% from the same period a year earlier. Earnings of $1.23 per share improved well from $1.08 in the fourth quarter of 2020, and full-year earnings of $4.38 per share were up 17% year over year other.

However, CEO Mark Widmar pointed to supply chain, logistics and pandemic-related headwinds that are putting pressure on First Solar’s cost structure. Although they overcame most of these challenges in 2021, First Solar’s forecast for 2022 included provisions for weaker metrics to come. The sales forecast of $2.4 billion to $2.6 billion would not only be down sharply from the $2.92 billion in revenue for the full year 2021, but also lower than what First Solar has reported. reported in 2020. Worse still, earnings of between $0 and $0.60 per share threw cold water on shareholders’ hopes of consistent results.

Moving away from fossil fuels has positive implications for solar power stocks, so it’s troubling to see First Solar failing to take full advantage of the opportunity before it. The company’s outlook shows how difficult it will be to make a transition to renewable energy, with inevitable obstacles along the way.

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Dan Caplinger has no position in the stocks mentioned. The Motley Fool owns and recommends Salesforce.com. The Motley Fool recommends First Solar. The Motley Fool has a disclosure policy.

The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.

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