Salesforce

Software - Application • Technology • San Francisco, CA, United States • CRM (NYQ)

415 901 7000 Salesforce Tower, San Francisco, CA 94105, United States

Quarter: Q3 2025 Reported: September 3, 2025 Sentiment: Positive

Salesforce, Inc. provides customer relationship management technology that connects companies and customers together worldwide. The company offers Agentforce, an agentic layer of the salesforce platform; Data Cloud, a data engine; Industries AI for creating industry-specific AI agents with Agentforce; Salesforce Starter, a suite of solution for small and medium-size business; Slack, a workplace communication and productivity platform; Tableau, an end-to-end analytics solution for range of enterprise use cases and intelligent analytics with AI models, spot trends, predict outcomes, timely recommendations, and take action from any device; and integration and analytics solutions, as well as Agentforce Command Center, an observability solution to manage, track, and scale AI agent activity. It also provides marketing platform; commerce services, which empowers shopping experience across various customer touchpoint; and field service solution that enables companies to connect service agents, dispatchers, and mobile employees through one centralized platform to schedule and dispatch work, as well as track and manage jobs. The company has a strategic partnership with Google to integrate Agentforce 360 with Google Workspace for sales and IT service, which expands the Salesforce Gemini integration. Salesforce, Inc. was incorporated in 1999 and is headquartered in San Francisco, California.

Analysis Summary

Salesforce announced robust second-quarter fiscal year 2026 results, exceeding all financial targets and demonstrating strong operational execution. Total revenue for the quarter was $10.2 billion, a 10% increase year-over-year (9% in constant currency), with subscription and support revenue reaching $9.7 billion, up 11% (9% in constant currency). Current remaining performance obligation (cRPO) grew 11% year-over-year to $29.4 billion. Profitability saw significant improvement, with GAAP operating margin at 22.8% and non-GAAP operating margin at 34.3%, marking the tenth consecutive quarter of non-GAAP operating margin expansion. The company returned $2.6 billion to shareholders, including $2.2 billion in share repurchases, and authorized an additional $20 billion for its share repurchase program, bringing the total to $50 billion.

Strategically, Salesforce's focus on AI and Data Cloud is yielding substantial results. Data Cloud and AI annual recurring revenue (ARR) surpassed $1.2 billion, representing a remarkable 120% year-over-year growth. The new Agentforce solution has closed over 12,500 deals, with more than 6,000 being paid, and handled over 1.4 million requests on help.salesforce.com. Over 40% of Q2 bookings for Data Cloud and Agentforce came from existing customer expansion, highlighting successful cross-selling and up-selling. Service and Platform offerings were integral to all top 10 deals in Q2, underscoring their foundational importance. Management emphasized the vision of 'agentic enterprises,' where humans and AI agents collaborate to enhance workflows and productivity.

For the third quarter of fiscal year 2026, Salesforce initiated revenue guidance of $10.24 billion to $10.29 billion, representing 8%-9% year-over-year growth. The full-year FY26 guidance was raised, with revenue now expected to be between $41.1 billion and $41.3 billion (8.5%-9% Y/Y growth). Non-GAAP operating margin guidance for the full year was also raised to 34.1%, and operating cash flow growth is projected to be approximately 12%-13% year-over-year. Non-GAAP diluted EPS guidance for Q3 FY26 is $2.84-$2.86, and for the full year FY26, it's $11.33-$11.37.

Key risk factors highlighted include uncertainties surrounding the pending Informatica acquisition, the ability to maintain security levels and service performance, reliance on third-party infrastructure providers, the evolving landscape of AI technologies and their integration, and the impact of geopolitical events and macroeconomic volatility.

Key Highlights

• Q2 FY26 Revenue of $10.2 billion, up 10% Y/Y, exceeding guidance.
• Non-GAAP Operating Margin reached 34.3%, marking the tenth consecutive quarter of expansion.
• Data Cloud and AI Annual Recurring Revenue (ARR) surpassed $1.2 billion, growing 120% Y/Y.
• Agentforce closed over 12,500 deals and handled 1.4 million requests, demonstrating strong AI adoption.
• Raised full-year FY26 revenue guidance to $41.1 billion - $41.3 billion and non-GAAP operating margin to 34.1%.
• Increased share repurchase program by $20 billion, bringing total authorization to $50 billion.
• Operating cash flow growth guidance raised to approximately 12%-13% Y/Y for FY26.

Financial Metrics

eps

1.96

YoY: 33.33%

revenue

10.2 billion

YoY: 10%

guidance

net income

1.887 billion

YoY: 32.05%

growth rates

Stock Performance (90 Days)

Data through Dec 29, 2025

Positive Signals

• Exceeded guidance across all key financial metrics (revenue, margin, cash flow, cRPO).
• Tenth consecutive quarter of non-GAAP operating margin expansion, demonstrating sustained profitability.
• Exceptional growth in Data Cloud and AI ARR (120% Y/Y) and strong adoption of Agentforce.
• Raised full-year revenue and operating cash flow growth guidance, indicating strong forward momentum.
• Significant increase in share repurchase authorization ($20 billion), reflecting confidence in valuation and commitment to shareholder returns.

Risks & Concerns

— Uncertainties and potential challenges related to the pending acquisition of Informatica, including regulatory approvals and integration.
— Risks associated with maintaining sufficient security levels, service performance, avoiding downtime, and preventing security breaches.
— Reliance on third-party infrastructure providers and the ability to secure sufficient data center capacity.
— Uncertainties regarding AI technologies, their successful integration into product offerings, and the ability to compete in evolving markets.
— Impact of geopolitical events, inflationary pressures, market and macroeconomic volatility, and foreign currency exchange rate fluctuations.