Sridhar Vembu Takes a Dig at Rival Salesforce’s Market Cap Decline
At the keynote speech of Zoho Corporation’s user developer conference, Zoholics ‘24, that is currently ongoing in Austin, co-founder and CEO Sridhar Vembu commented on Salesforce’s recent disappointing earnings that led to a huge drop in its market capitalisation, alluding to the company’s weak planning strategy. Showcasing quotes from Salesforce President and COO Brian Millham during the company’s recent earnings call, including ‘measured buying behaviour’ and ‘elongated deal cycles, deal compression, and high levels of budget scrutiny,’ Vembu described them as, “The words that erased $52 billion in market capitalisation in 24 hours.” Sridhar Vembu Keynote Speech. Source: Zoho He even jokingly said, “An AI can regurgitate all those words now, about what a good earnings warning is like.” Last week, Salesforce announced its disappointing earnings results which led to its stock falling by almost 20% the next day. It was the biggest single-day percentage drop since its stock fell 27.2% in July 2004. The company lost $52 billion in a day. Talking about Zoho’s promising records, Vembu called out that they have zero debt on their balance sheet. “Our balance sheet is one of the cleanest in the world,” he said. Profits and Firing Vembu has often been critical about other companies’ approach when it comes to firing employees. Believing that even a 7% attrition rate at Zoho is terrible, Vembu was amazed at how one of the founders he interacted with was having no problem with a 25% rate in their company. Vembu pointed out how a number of profitable companies last year resorted to laying off people which he considered to be stupid. “I don’t understand why they do it because they don’t understand what it does to employee morale long term.” Vembu explains how companies cutting costs to survive makes sense, whereas, profitable companies that say they are not making enough profit or enough numbers and growth, hence, resorting to firing is incomprehensible. “I won’t be able to make these statements as a public company CEO today, which tells you something about what our priorities have become in business. We want to escape that type of pressure, that’s why we have chosen to stay private,” said Vembu. Interestingly, this is not the first time Vembu criticised Salesforce. Earlier this year, Vembu called out Salesforce’s hiring and firing sprees to be driven by short-term, quarterly financial goals. Source: X Scrutinising Zoho’s valuation, Sridhar Vembu remains nonchalant. “I pay absolutely no attention to what our valuation is. I don’t know and I don’t care,” he said.
“I pay absolutely no attention to what our valuation is. I don’t know and I don’t care,” said Vembu.
“I pay absolutely no attention to what our valuation is. I don't know and I don't care," said Vembu.
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As a rare blend of engineering, MBA, and journalism degree, Vandana Nair brings a unique combination of technical know-how, business acumen, and storytelling skills to the table. Her insatiable curiosity for all things startups, businesses, and AI technologies ensures that there's always a fresh and insightful perspective to her reporting. She now hosts her tech segment 'Point Break' on AIM Tv.