SuccessFactors’ Financials
SuccessFactors, with 2009 revenue of $153.1 million, recently reported non-GAAP third quarter revenue of $53.4 million, up 38% y-o-y and 8% q-o-q. On a GAAP basis, net loss widened to $2.81 million, or $0.04 per share, from a loss of $1.97 million, or $0.03 per share, last year. On a non-GAAP basis, net income was $1.08 million or $0.01 per share compared with net income of $0.59 million or $0.01 per share last year.

SuccessFactors also raised its guidance for the fiscal year. It now expects full-year 2010 non-GAAP revenue in the range of $203.2 million to $203.7 million, raised from the earlier guidance of $198 million to $200 million. It expects non-GAAP EPS of $0.06 to $0.07, up from the earlier guidance of break-even. For the fourth quarter, SuccessFactors expects to break even on non-GAAP revenue of $55.5 million to $56 million. SuccessFactors is trading around $30.5 with market cap of about $2.3 billion. It hit a 52-week high of $30.85 on November 26.

Taleo’s Financials
Taleo, with 2009 revenue of $198.4 million, recently reported third quarter revenue of $58.7 million, up 16% y-o-y driven by an 8% rise in application revenue. Net income was $1.6 million or $0.04 per share compared to a net loss of $1.1 million or $0.04 per share last year. Non-GAAP net income was $11.0 million or $0.25 per share compared to non-GAAP net income of $6.7 million or $0.20 per share last year.

Taleo signed 214 new customers in the quarter and closed four large enterprise deals with annual contract values in excess of $250,000. Cash flow from operations was $15.4 million, and the company ended the quarter with total cash of $264 million. Taleo is trading around its 52-week high of $31.22 with market cap of about $1 billion.

Recent Acquisitions
This quarter, there again has been M&A activity in the talent management sector. It started with Salary.com’s being lapped up by Kennexa for $80 million in September. Salary.com has annual revenue of $45.75 million. I earlier interviewed its founder and former CEO, Kent Plunkett.

A day after the Salary.com acquisition, Taleo announced its plans to acquire learning management software (LMS) startup, Learn.com, for $125 milllion. This is Taleo’s first acquisition since it acquired WorldWide Compensation for $16 million last year. In October, SuccessFactors announced its acquisition of YouCalc, a SaaS analystics company, giving it a push into real-time analytics and also a presence in Europe. SuccessFactors this year acquired a SaaS vendor in HR, talent analytics, and workforce planning, Inform Business Impact for about $40.5 million and CubeTree, a social enterprise platform, for about $50 million.

Financial analyst Brenon Daly on Seeking Alpha notes that “the number of deals and spending in the human capital management (HCM) market so far this year is rivaling the records set when the overall M&A market was much healthier.” He further reports that recent indications have pointed toward a sale of GeoLearning:

Sources have indicated that ADP may have been the initial bidder for Learn.com, looking to add to the half-dozen HCM acquisitions the services giant has already done. We would expect ADP to at least look closely at GeoLearning. But from our perspective, the more likely acquirer for GeoLearning is SuccessFactors (SFSF). The two companies have had an integrated offering on the market for more than four years, and continue as close partners. We gather that GeoLearning is slightly larger than Learn.com, which was running at about $30m in sales.

Another interesting SaaS talent management company that I recently came across in my 1M/1M roundtables is an Indian company, SurgeForth. The SaaS market for Asia Pacific was $500 million in 2009 and is expected to double by 2011. The SaaS HCM market in  Asia Pacific is about $35 million. India’s SaaS HCM market in 2011 is expected around $7 million. SurgeForth’s target is to capture 10%, or $0.7 million, of the Indian HCM market by 2011. But SurgeForth has the potential to be another Zoho, undercutting U.S. prices by 70%–80%. For more coverage, read guest author Praveen Kumar’s post on the company in the 1M/1M Incubation Radar series.