Salesforce continues to lean heavily on partners as the cloud company marches toward its revenue goal of $23 billion by fiscal year 2022, according to Co-CEO Keith Block.
"Partners are absolutely critical to the Salesforce growth strategy, bringing deep industry and domain expertise that they extend our reach and help drive our customers’ digital transformation," Block said during the company's Q2 fiscal 2019 earnings call on Wednesday. "And our partners continue to strategically invest in their Salesforce practices."
Reinforcing the point, Block shared these factoids.
- The company's top five systems integrator partners increased their total Salesforce certification by 50 percent in Q2.
- Partners increasingly run their businesses on Salesforce's software -- including a 300,000 seat deployment at Deloitte.
Looking ahead, platforms like Sales Cloud, Service Cloud and Marketing Cloud should drive more partner opportunities, he asserted. "The Sales Cloud growth is now $1 billion plus run rate, which is unprecedented marketplace," he noted. "We've obviously seen great success with Service Cloud and Marketing Cloud." Plus, the company "loves the fact that our partners are investing in these elements of innovation."
Salesforce's revenue momentum seems to reinforce those points. For its Q2 of fiscal 2019:
Revenue rose 27.1 percent to $3.28 billion, which beat Wall Street's estimates by $50 million, SeekingAlpha estimates.
Professional services and other revenues were $221 million, up only 14 percent year-over-year. That low figure reinforces a heavy focus on partners rather than Salesforce's own consulting services.
Salesforce Partners Pursue Mergers, Acquisitions
The hot market for Salesforce deployment and consulting skills has fueled M&A activity among partners. Recent deals include
- August 2018: Cognizant Technology Solutions acquired SaaSfocus, a major Salesforce cloud consulting partner in the Asia-Pacific (APAC) region with operations in Australia and India.
- August 2018: ScanSource acquired Canpango, a Salesforce implementation and cloud consulting partner.
- May 2018: FMT Consultants, a Microsoft and NetSuite partner, acquired Salesforce partner Red Sky Solutions of Orange Country, California.
- May 2018: Simplus acquired CirrusOne, a Salesforce and Oracle partner that offers consulting services for CPQ (configure, price, quote) and quote-to-cash solutions.
- May 2018: Spaulding Ridge acquired Baun Consulting, a cloud CRM partner.
All that partner ecosystem activity bodes well for Block, who shifted to the co-CEO role with Marc Benioff earlier this month.