Salesforce.com 2012 Annual Report Download - page 54

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Marketing and sales expenses were $792.0 million, or 48 percent of total revenues, during fiscal 2011,
compared to $605.2 million, or 46 percent of total revenues, during fiscal 2010, an increase of $186.8 million.
The increase in absolute dollars was primarily due to increases of $143.1 million in employee-related costs,
$16.7 million in stock-based expenses, $12.1 million in advertising costs and marketing and event costs, $1.0
million in depreciation and amortization, and $12.6 million in allocated overhead. Our marketing and sales
headcount increased by 34 percent since January 31, 2010 as we hired additional sales personnel to focus on
adding new customers and increasing penetration within our existing customer base. Some of the increase in
headcount was due to acquired businesses.
General and Administrative.
Fiscal Year Ended January 31, Variance
Dollars(In thousands) 2011 2010
General and administrative ......................... $255,913 $195,290 $60,623
Percent of total revenues ........................... 15% 15%
General and administrative expenses were $255.9 million, or 15 percent of total revenues, during fiscal
2011, compared to $195.3 million, or 15 percent of total revenues, during fiscal 2010, an increase of $60.6
million. The increase was primarily due to increases of $46.8 million in employee-related costs, $9.5 million in
stock-based expenses, and increases in depreciation and amortization, service delivery costs, and professional
and outside service costs. Our general and administrative headcount increased by 30 percent since January 31,
2010 as we added personnel to support our growth.
Income from operations.
Fiscal Year Ended January 31, Variance
Dollars(In thousands) 2011 2010
Income from operations ........................... $97,497 $115,272 $(17,775)
Percent of total revenues ........................... 6% 9%
Income from operations during fiscal 2011 was $97.5 million and included $120.4 million of stock-based
expenses and $19.7 million of amortization of purchased intangibles. During fiscal 2010, operating income was
$115.3 million and included $88.9 million of stock-based expenses and $11.3 million of amortization of
purchased intangibles.
Investment income.
Fiscal Year Ended January 31, Variance
Dollars(In thousands) 2011 2010
Investment income ................................ $37,735 $30,408 $7,327
Percent of total revenues ............................ 2% 2%
Investment income consists of income on cash and marketable securities balances. Investment income was
$37.7 million during fiscal 2011 and was $30.4 million during fiscal 2010. The increase was primarily due to the
increase in marketable securities balances resulting from cash generated by operating activities and the proceeds
from stock option exercises and the convertible senior notes.
Interest expense.
Fiscal Year Ended January 31, Variance
Dollars(In thousands) 2011 2010
Interest expense .................................. $(24,909) $(2,000) $(22,909)
Percent of total revenues ........................... 2% 0%
50