With competitors from Microsoft Corp. to Oracle Corp. training their guns on Salesforce.com Inc.’s core customer relationship management business, many market watchers have been wondering when the company’s torrid growth rate will slow. They’re still wondering.

The CRM giant once again topped estimates in its fiscal fourth quarter, reporting net income of $67.6 million, or 35 cents per share, on a 24 percent jump in revenue, to $2.85 billion. Analysts were expecting earnings of 34 cents a share on revenue of $2.81 billion.

Salesforce.com also raised guidance for the fiscal first quarter and full year of 2019, The company said it now expects to earn between 43 and 44 cents per share on revenue of about $2.93 billion in the quarter, ahead of analyst expectations of 37 cents and $2.9 billion, respectively. For the full year, Salesforce.com is forecasting $12.54 billion in sales. Executives restated their confidence that the company will hit a $20 billion annual run rate by 2022, making it the fastest software company ever to achieve that milestone.

Shares in CRM stock rose about 1.5 percent in after-hours trading following a generally dismal day on Wall Street.

Grow, grow, grow

On the company’s earnings call, executives spoke little about profits and mostly about growth. That’s consistent with past patterns, said Andrew Bartels, vice president and principal analyst at Forrester Research Inc. “It’s the same old story: Salesforce beats on revenue growth, spends more on marketing and sales than expected and ekes out a small profit,” he said. “This company is investing tons in marketing and sales to buy revenue.”

Indeed, Salesforce.com’s marketing and sales expenses have been rising faster than revenue. They totaled $1.36 billion in the quarter, up 25 percent year-over-year. In contrast, research and development expenses rose a comparatively small 15 percent. Chief Executive Marc Benioff (pictured) offered a simple explanation: “We saw acceleration in new business, which incurred higher commissions and expenses,” he said.

For now, there seems to be no reason to change the strategy. Bartels noted that Salesforce.com’s ability to sacrifice earnings for growth gives it a competitive advantage against more bottom-line-oriented companies such as Microsoft and Oracle. “There’s no evidence so far that Salesforce’s growth has been dented by competition,” he said.

There’s also no evidence that anything is about to change in a bull market stoked by tax cuts. “I’ve never seen a demand environment like this,” Benioff said. “Every CEO is using the positive economic environment, as well as the domestic tax cuts, as a way to accelerate their digital transformation.”

There’s nothing new or innovative about a growth-centered strategy, said Charles King, president and principal analyst at Pund-IT Inc. “We’ve seen similar dynamics around other visionary companies,” he said, citing VMware Inc. as an example. “They were able to steadily expand their primary markets while also pursuing new, complementary business lines. Salesforce is following a similar path.” VMware reports earnings tomorrow.

‘Mind-bending’ backlog

Growth was generally strong across the board. The company’s flagship Sales Cloud service grew 15 percent, Service Cloud sales rose 29 percent and Marketing and Commerce Cloud surged 33 percent.

Perhaps the most remarkable number, though, was the 48 percent growth in unbilled backlog to $13.3 billion, a number that one analyst turned “mind-bending.” Chief Operating Officer Keith Block attributed the increase to “deeper, longer relationships with customers, which is why the backlogs are growing.”

So are deal sizes. The company said it closed twice as many $20 million plus deals in the quarter as a year ago and deals of excess of $1 million grew 43 percent in the fourth quarter. The company is also successfully cultivating its partner ecosystem, which contributed more than 55 percent of new business.

Salesforce.com’s head start in the software-as-a-service market, combined with its momentum, will make it difficult for rivals to challenge it, said King. “That doesn’t mean that Oracle and Microsoft won’t build up their own businesses or make a decent living in markets that Salesforce also inhabits,” he said. “But at least for now, whatever success they enjoy doesn’t seem to be coming at Salesforce’s expense.”

Not least, Salesforce’s broad market continues to expand. “We continue to see marketing technology taking share of marketers’ overall budgets as they look to better capitalize on customer relationships, automate workflows and apply related data towards improved media choices,” Pivotal Research Inc. analyst Brian Wieser said in a note to clients.

Image: Salesforce.com/Facebook