Salesforce.com 2011 Annual Report Download - page 41

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ITEM 7. MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND
RESULTS OF OPERATIONS
The following discussion contains forward-looking statements, including, without limitation, our
expectations and statements regarding our outlook and future revenues, expenses, results of operations, liquidity,
plans, strategies and objectives of management and any assumptions underlying any of the foregoing. Our actual
results may differ significantly from those projected in the forward-looking statements. Factors that might cause
future actual results to differ materially from our recent results or those projected in the forward-looking
statements include, but are not limited to, those discussed in the section titled of this Annual Report on
Form 10-K “Risk Factors.” Except as required by law, we assume no obligation to update the forward-looking
statements or our risk factors for any reason.
Overview
We are a leading provider of enterprise cloud computing applications. We provide a comprehensive
customer and collaboration relationship management, or CRM, service to businesses of all sizes and industries
worldwide and we provide a technology platform for customers and developers to build and run business
applications.
We were founded in February 1999 and began offering our enterprise CRM application service in February
2000. Since then, we have augmented our CRM service with new editions and enhanced features. We introduced
our Force.com platform to customers and developers so they can build complementary applications to extend
beyond CRM. In 2010 we introduced our AppExchange directory of enterprise cloud computing applications that
are integrated with our CRM service and in most cases have been developed on our platform by third parties. We
also introduced Chatter, a collaboration application for the enterprise to connect and share information securely
and in real-time.
Our objective is to be the leading provider of CRM application services and to be the leading platform on
which our customers and partners build cloud computing applications. Key elements of our strategy include:
• Strengthening our existing CRM applications and extending into new functional areas within CRM;
• Pursuing new customers and new territories aggressively;
• Deepening relationships with our existing customer base;
• Continuing to lead the industry transformation to the next phase of cloud computing; and
• Encouraging the development of third-party applications on our Force.com cloud computing platform.
We believe the factors that will influence our ability to achieve our objectives include our prospective
customers’ willingness to migrate to an enterprise cloud computing application service; the performance and
security of our service; our ability to continue to release, and gain customer acceptance of, new and improved
features; our ability to successfully integrate acquired businesses and technologies; successful customer adoption
and utilization of our service; acceptance of our service in markets where we have few customers; the emergence
of additional competitors in our market and improved product offerings by existing and new competitors; the
location of new data centers; third-party developers’ willingness to develop applications on our platform; and
general economic conditions which could affect our customers’ ability and willingness to purchase our
application service, delay the customers’ purchasing decision or affect renewal rates.
To address these factors, we will need to, among other things, continue to add substantial numbers of paying
subscriptions, upgrade our customers to fully featured versions such as our Unlimited Edition, provide high
quality technical support to our customers and encourage the development of third-party applications on our
Force.com platform. We plan to invest for future growth by expanding our data center capacity. We also plan to
hire additional personnel, particularly in direct sales, other customer-related areas and research and development.
As part of our growth plans, we intend to continue focus on retaining customers at the time of renewal.
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