Salesforce, Inc.

What they do

Salesforce provides cloud-based customer relationship management (CRM) software across sales, service, marketing, commerce, and IT, sold primarily on a subscription basis. Its platform unifies customer data and embeds AI agents, called Agentforce, into core applications. The company also offers Data 360 for data management and integration, and serves industry-specific verticals.

Revenue drivers

• Subscription and support revenue — Core subscription and support revenue, including Sales, Service, and Platform products, was $10.6 billion in Q1 FY27, up 14% year-over-year (including $428 million from Informatica). This is the primary revenue stream.
• Agentforce and Data 360 ARR — Combined annual recurring revenue (ARR) for Agentforce and Data 360 reached nearly $3.4 billion, up over 200% year-over-year, with Agentforce ARR at $1.2 billion (up 205% YoY) and Informatica Cloud ARR contributing $1.1 billion.
• Industry Cloud solutions — Industry vertical solutions, including Public Sector Industry Cloud, generate significant ARR; Public Sector ARR surpassed $2 billion, up 23% year-over-year.

Recent performance

In Q1 FY27 (ended April 30, 2026), Salesforce reported record revenue of $11.1 billion, up 13% year-over-year (12% in constant currency). GAAP EPS was $2.42 (up 52% YoY) and non-GAAP EPS was $3.88 (up 50% YoY). GAAP operating margin improved to 21.1%, and operating cash flow grew 3% to $6.7 billion. The company returned $27.5 billion to shareholders, including $27.1 billion in buybacks. For fiscal 2026, revenue was $41.5 billion (up 10% YoY) with operating margin around 20%.

Strategy

Salesforce is investing heavily in agentic AI, embedding Agentforce into all Customer 360 applications and expanding Data 360 for data integration. The company completed acquisitions of Informatica and Regrello to accelerate its agentic roadmap. Management is focused on profitable growth, reducing operating expenses, and expanding enterprise and international penetration. They also initiated a $25 billion accelerated share repurchase (ASR) upon debt issuance to return capital.

Risks

• Security breaches — Any security failure in Salesforce's systems or those of its third-party providers could compromise customer data and damage trust.
• Service disruptions — Defects or interruptions in services could reduce demand and harm the company's reputation.
• Third-party dependencies — Reliance on data center hosting and cloud platform providers means outages in those services could disrupt Salesforce's offerings.
• Acquisition integration — Inability to realize expected benefits from acquisitions like Informatica and Regrello could affect financial results.

Outlook

For Q2 FY27, Salesforce guides revenue of $11.27–$11.35 billion, up 10-11% year-over-year, including slightly over 4 points from Informatica. Full-year FY27 revenue guidance was raised to $45.9–$46.2 billion (up 11% YoY) with non-GAAP operating margin maintained at 34.3%. Management expects organic revenue acceleration in the second half of FY27, driven by Sales, Service, Slack, Agentforce, and Data 360.