SAN FRANCISCO, Calif. – Salesforce.com (NYSE: CRM), an industry leader in Software as a Service (SaaS) and Platform as a Service (PaaS), announced its fiscal second quarter results on Thursday, and based on the numbers, it is the first SaaS company to exceed $1 billion in total annual revenue.

"By becoming the first ever Software as a Service company to achieve an annualized revenue run rate of one billion dollars, our second quarter performance is a milestone for salesforce.com, and for the cloud computing industry, " said Marc Benioff, Chairman and CEO. "Our largest customers are increasingly becoming the best examples of what is possible using the power of our growing portfolio of Software as a Service applications and our emerging Platform as a Service."

Salesforce.com delivered the following results for its second quarter fiscal year 2009:

Revenue: Total Q2 revenue was $263.1 million, an increase of 49% on a year-over-year basis and an increase of 6% on a quarter-over-quarter basis. Subscription and support revenues were $239.7 million, an increase of 50% on a year-over-year basis and an increase of 6% on a quarter-over-quarter basis. Professional services and other revenues were $23.4 million, an increase of 41% on a year-over-year basis and an increase of 5% on a quarter-over-quarter basis.

Earnings per Share: Q2 GAAP diluted earnings per share were approximately $0.08, including approximately $19 million in stock based compensation and approximately $1.3 million in amortization of purchased intangibles related to previously announced acquisitions. For the basis of Q2 GAAP EPS calculations, there was an average of approximately 126 million diluted shares outstanding during the quarter.

Cash: Cash from operations for the fiscal second quarter was approximately $53 million, up 53% year-over-year, and seasonally down 37% from Q1. Total cash, cash equivalents and marketable securities finished the quarter at approximately $823 million, an increase of approximately $73 million from Q1 and up approximately $326 million from July 31, 2007.

Deferred Revenue: Deferred revenue was approximately $480 million as of July 31, 2008, an increase of 49% on a year-over-year basis and up 2% on a quarter-over-quarter basis.

Q3 FY09: Revenue for the company’s third fiscal quarter is projected to be in the range of approximately $273 million to approximately $274 million. Excluding the effect of the InStranet acquisition, the company’s EPS outlook is $0.08 to $0.09. Including the effect of the InStranet acquisition, estimated at $0.02 for the third quarter, the company is issuing guidance that its GAAP fully diluted EPS will be in the range of $0.06 to $0.07. The GAAP EPS estimate also includes the effects of stock based compensation and the amortization of purchased intangibles. For the third fiscal quarter, stock based compensation expense is expected to be approximately $20 million, and the expense associated with amortization of purchased intangibles, including that associated with the acquisition of InStranet, is expected to be approximately $2.0 million. For purposes of the Q3 GAAP fully diluted EPS calculation, the company is expecting an average diluted shares count of approximately 127 million shares, and a GAAP tax rate of 48%.