- Salesforce’s Q1 revenue reached $9.83 billion, marking a 7.6% increase year-over-year.
- In constant currency terms, the revenue growth was 8%, surpassing the estimate of 7.28%.
- Adjusted Earnings Per Share (EPS) was $2.58, compared to $2.44 from the previous year.
- Subscription and support revenue grew by 8.3% to $9.30 billion, exceeding the estimate of $9.22 billion.
- Sales totaled $2.13 billion, slightly below the estimated $2.16 billion, representing a 6.7% increase year-over-year.
- Service revenue increased by 7% to $2.33 billion, slightly below the expected $2.35 billion.
- Professional services and other revenue declined by 2.9% to $532 million, near the estimate of $530.4 million.
- Unearned revenue at the end of the period was $17.80 billion, exceeding the estimate of $17.65 billion with an 11% year-over-year increase.
- Adjusted income from operations rose by 8.3% to $3.17 billion, slightly missing the estimate of $3.18 billion.
- Adjusted operating margin improved from 32.1% to 32.3%, close to the estimated 32.6%.
- The current remaining performance obligation grew by 12% to $29.6 billion, beating the estimate of $29.05 billion.
- Noncurrent remaining performance obligation was reported at $31.3 billion, exceeding the estimate of $30.8 billion.
- Significant in constant currency adjustments: Platform & Other revenue increased by 14%, Integration & Analytics revenue by 10%.
- Free cash flow grew by 3.5% to $6.30 billion, outperforming the estimate of $5.89 billion.
- CEO Marc Benioff announced a $400 million increase in revenue guidance for FY26, targeting $41.3 billion at the high end.
- Q2 FY26 revenue is guided between $10.11 billion and $10.16 billion, up 8% – 9% year-over-year.
- Salesforce maintains its full-year FY26 GAAP operating margin guidance at 21.6% and non-GAAP operating margin guidance at 34.0%.
- Operating cash flow growth for the full year FY26 is expected to grow by approximately 10% to 11% year-over-year.
- The current analyst consensus includes 49 buy ratings, 10 hold ratings, and 2 sell ratings for Salesforce shares.
Salesforce.Com Inc on Smartkarma
Analysts on Smartkarma, like Baptista Research, are closely monitoring Salesforce.Com Inc and providing valuable insights. Baptista Research published a bullish report titled “Salesforce’s Growth Is Slowing—Can Agentforce Turn Things Around?” highlighting Salesforce’s strong financial performance for fiscal year 2025. The company reported a significant increase in revenue, reaching $37.9 billion annually, with a landmark $10 billion quarter. Subscription and support revenue also grew by 10%, showcasing continued demand for Salesforce’s enterprise software solutions.
In another report by Baptista Research, titled “Salesforce’s Big Moves: What Margin Expansion and Cloud Revenue Growth Mean for Investors! – Major Drivers,” analysts delve into Salesforce’s third-quarter performance for fiscal 2025. Despite facing challenges in transitioning to newer markets and technologies, Salesforce posted an 8% year-over-year revenue increase, reaching $9.44 billion. The robust performance in core segments like the Sales and Service Clouds, with double-digit growth, signals promising opportunities for investors to consider.
A look at Salesforce.Com Inc Smart Scores
| Factor | Score | Magnitude |
|---|---|---|
| Value | 2 | |
| Dividend | 2 | |
| Growth | 5 | |
| Resilience | 4 | |
| Momentum | 2 | |
| OVERALL SMART SCORE | 3.0 |
Smart Score is a compound score for the Company indicating its overall outlook. It is derived by taking an equally weighted average of underlying Factor scores computed by Smartkarma
Based on Smartkarma Smart Scores, Salesforce.Com Inc seems to have a positive long-term outlook. The company scores high on growth and resilience, indicating strong potential for future expansion and the ability to weather economic challenges. These factors suggest that Salesforce.Com Inc may continue to experience strong performance in the coming years.
Although the company’s scores for value, dividend, and momentum are not as high, its focus on growth and resilience highlights its strategic positioning in an ever-evolving market. Salesforce.Com Inc‘s core business model of providing software on demand for businesses worldwide positions it as a key player in the customer relationship management service sector, offering vital technology solutions for clients to manage their critical data effectively.
Disclaimer: This article by Smartkarma is general in nature and based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. Note that our articles may not factor in the latest price-sensitive company announcements or qualitative material.
While all reasonable care has been taken in the preparation, Smartkarma makes no assurance about the accuracy of any generated data or content. All content is indicative only and should be independently checked for accuracy and confirmed before use. Smartkarma accepts no responsibility for any loss or damage caused as a result of any inaccuracy or error within the Lab online tools or generated data.
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