CRM Salesforce, Inc.

Operator (Operator): Good afternoon, everyone. My name is Leila, and I will be your conference operator today. At this time, I would like to welcome you to the Salesforce second quarter fiscal 2026 conference call. This conference is being recorded, and all lines have been placed on mute to prevent any background noise. After the speakers' remarks, there will be a question and answer session. At this time, I would like to turn the call over to Mike Spencer, executive vice president of finance and strategy and investor relations. Sir, you may begin. Mike Spencer (Executive Vice President of Finance and Strategy): Good afternoon, and thanks for joining us today on our fiscal 2026 second quarter results conference call. Our press release, SEC filings, and a replay of today's call can be found on our website. Joining me on the call today is Marc Benioff, Chair and CEO, Robin Washington, chief operating and finance officer. We also have Srini Talabhrigada, president and chief engineering customer success officer, and Miguel Milano, president and chief revenue officer, joining us for the Q&A portion of the call. Some of our comments today may contain forward-looking statements that are subject to risks, uncertainties, and assumptions, which could change. Should any of these risks materialize or should our assumptions prove to be incorrect, actual company results or outcomes could differ materially from these forward-looking statements. A description of these risks and uncertainties and assumptions and other factors that could affect our financial results or outcomes is included in our SEC filings, including our most recent report on forms 10-K, 10-Q, and other SEC filings. Except as required by law, we do not undertake any responsibility to update these forward-looking statements. As a reminder, our commentary today will include non-GAAP measures. Reconciliations between our GAAP and non-GAAP results and guidance can be found in our earnings materials and press release. And with that, let me hand the call to Marc. Marc Benioff (Chair and CEO): Hey, Mike. Thank you so much, and I'm really excited to get into the call, and as you saw, we really had a great quarter to close out the first half of the year. With outstanding performance across all of our key metrics, including our revenue, our margin, our cash flow, our CRPO, and even our AI and data cloud numbers were all incredible. You know, we outperformed on Q2 revenue with $10.25 billion, up 10% year over year and 9% in constant currency. Miguel's sales team drove incredible momentum. Net new bookings from deals over $1 million grew 26% year over year, and we closed deals with companies like Dell, Marriott, Eaton, US Bank, Japan Post Bank, Lululemon, and the US Army. And non-GAAP operating margin came in strong at 34.3%, and we outperformed on CRPO with $29.4 billion, up 11% year over year, and the AI and data product line is up 120% year over year. We're on track to close out fiscal 2026 as a record year, raising our guidance on the low end for revenue, raising on non-GAAP operating margin and cash flow, and we expect to finish with nearly $15 billion in operating cash flow. That's incredible and a huge raise from the previous quarter. Make no mistake. These results aren't just financial milestones. It's the growth that we are seeing, particularly with agent force and data cloud, and it's proof, and you're about to get into this now as I start to really give you our fundamental organizing principle for the company and what I believe the enterprise industry is about to become because the agentic enterprise—the real manifestation of what AI was meant to be—well, that agentic enterprise has arrived. In the three quarters since we launched, there have been 6,000 paid deals and more than 12,500 overall. And 40% of our agent force new bookings this quarter came from existing customers extending their investment with Salesforce. And it's demonstrating the value that they're getting and how the flywheel is really working. We've seen a 60% increase quarter over quarter in customers who've gone from pilot to production, and they're expanding use cases and scaling consumption. And this is just the beginning of the most transformative time in our industry. Ever. I've never been more excited about anything in my entire career. We're about to get into it. I spent weeks on the road this summer meeting with CEOs, CIOs, and frontline teams. And one thing is extremely clear to me: every single one of our customers is becoming an agentic enterprise. It's a huge vision for the future, it's a huge vision for the future of business, and, really, it's a huge vision for the future of Salesforce. But this isn't just an upgrade. This isn't simply just some automating some existing business process. These agentic enterprises, well, for Salesforce, it's certainly true. It's a complete transformation. And for our customers, the agentic enterprise is a complete reinvention. In many cases, ... [transcript truncated at 5,000 chars — full text available via API]

Operator (Operator): Ladies and gentlemen, this is the operator. Today's conference is scheduled to begin momentarily. Until that time, your lines again will be placed on a music hold. Thank you for your patience. Welcome to Salesforce First Quarter Fiscal 2026 Results Conference Call. All lines have been placed on mute to prevent any background noise. After the speakers' remarks, there will be a question and answer session. If you would like to ask a question, please press star one. Also, this call is being recorded. And I would now like to hand the conference over to your speaker, Mike Spencer, Executive Vice President of Finance and Strategy and Investor Relations. Sir, you may begin. Mike Spencer (Executive Vice President of Finance and Strategy and Investor Relations): Thank you. Good afternoon. Thanks for joining us today on our fiscal 2026 first quarter results conference call. Our press release, SEC filings, and a replay of today's call can be found on our website. Joining me on the call today is Marc Benioff, Chair and CEO, and Robin Washington, Chief Operating and Finance Officer. In addition, we also have Srini Talabergata, President, Chief Engineering and Customer Success Officer, and Miguel Milano, President and Chief Revenue Officer, joining us for the Q&A portion of the call. Some of our comments today may contain forward-looking statements that are subject to risks, uncertainties, and assumptions, which could change. Should any of these risks materialize or should our assumptions prove to be incorrect, actual company results or outcomes could differ materially from these forward-looking statements. A description of these risks, uncertainties, assumptions, and other factors that could affect our financial results and outcomes is included in our SEC filings, including our most recent report on Forms 10-K, 10-Q, and any other SEC filings. Except as required by law, we do not undertake any responsibility to update these forward-looking statements. As a reminder, our commentary today will include non-GAAP measures. Reconciliations between our GAAP and non-GAAP results and guidance can be found in our earnings materials and press release. And with that, let me hand the call to Marc. Marc Benioff (Chair and CEO): Alright. Hey. Thanks so much, Mike. I really appreciate everything you're doing and before I get into all these exciting highlights from the quarter, there's so much to talk about. I just want to say a few words about Informatica. I'm sure everybody knows I love Informatica. I've been working with this company since probably 2006. We have a bossy, a former CEO last night, sent me a photo of me and him together at their user conference. I'm so excited that we have signed this definitive agreement to acquire them for $8 billion, which upon close is going to unite our number one AI CRM and, of course, their number one AI MDM and ETL. Bringing these things together, well, I couldn't be more excited about this acquisition. I've followed it very closely. The way they've rewritten their product into the cloud, their incredible engineering leadership, especially some of their incredible new engineering data centers, and what they've built is just awesome. I'm just so impressed with Informatica. We have the company that we really love. We love the people. We've loved the leadership, and I have to say we probably spent the last twenty years discussing how to bring the companies together. We spent a lot of time not only with their new CEO, but with their engineering teams. It all led to this incredible moment. It's an awesome acquisition for us. It's a transformational step. It's a great price for the company. We just want to be as disciplined as possible. At the end of the day, I know all of you already know this, but this is a great price for a great company. It’s got great multiples, it’s accretive, non-dilutive. And Informatica is more important to our customers than ever before because of what's happened with AI. Every AI transformation is a data transformation. The ability to unify or harmonize or activate all the data across the entire enterprise is the key. If you can imagine, you need to deploy all of this incredible agentic data. You've got to get your data right in Informatica combined with Salesforce data cloud and other key assets that we're going to bring to bear. We have big goals for the size and scale that that data business can get to. Robin will go through that in detail. We will work hard to advance this mission of Informatica to make sure that our customers' data is incredible. So, anyway, let me turn it over to Robin to give perspective on Informatica, and then we'll get into the quarter. Robin Washington (Chief Operating and Finance Officer): Thanks, Marc. We're incredibly excited to welcome Informatica to Salesforce upon closing. Our responsible M&A framework that Marc just spoke to is a key pillar of our capital allocation strategy. It's focused on three areas: customer su ... [transcript truncated at 5,000 chars — full text available via API]

Operator (Operator): Good day, everyone. Welcome to Salesforce's Fourth Quarter and Full Year Fiscal 2025 Results Conference Call. This call is being recorded. I would now like to hand the conference over to your speaker, Mike Spencer, Executive Vice President of Finance and Strategy and Investor Relations. Sir, you may begin. Michael Spencer (Executive Vice President of Finance and Strategy): Good afternoon and thanks for joining us today on our Fiscal 2025 Fourth Quarter Results Conference Call. Our press release, SEC filings, and a replay of today's call can be found on our website. Joining me on the call today is Marc Benioff, Chair and CEO; Amy Weaver, President and Chief Financial Officer; and Brian Millham, President and Chief Operating Officer. In addition, we also have Robin Washington, our Board Member and Incoming Chief Operating and Finance Officer here with us today. As a reminder, our commentary today will include non-GAAP measures. Reconciliations between our GAAP and non-GAAP results and guidance can be found in our earnings materials and press release. Some of our comments today may contain forward-looking statements that are subject to risks, uncertainties, and assumptions, which could change. Should any of these risks materialize or should our assumptions prove to be incorrect, actual company results could differ materially from these forward-looking statements. A description of these risks and uncertainties and assumptions and other factors that could affect our financial results is included in our SEC filings, including our most recent report in Forms 10-K, 10-Q, and any other SEC filings. Except as required by law, we do not undertake any responsibility to update these forward-looking statements. And with that, let me hand the call over to Marc. Marc Benioff (Chair and CEO): Well, hey, thanks so much, Mike. And I'm so excited about this call and reading the script with you because this was just the best quarter we've ever had. And I think you're going to see that as we kind of unfold what's happening here. And I'm sitting here with Amy and Brian and Mike and Sebastian is also on the table and our new COFO, Robin Washington is here. So welcome, Robin. We're thrilled to have you here as well. And look, I'm really excited about this. I really think that we have something incredible to talk about and obviously, this was the quarter of Agentforce. We're going to talk about that, but it was really just another incredible quarter. And really it's been another incredible year of growth and innovation. I'm sure you all can see we've had a really strong performance across all of our key metrics on revenue, on margin, EPS, cash flow, cRPO. We've passed some amazing milestones, including more than $60 billion in RPO, and this has been the highest cash flow in our company history. You can see we exceeded our cash flow guidance. I think Amy did about $12.9 billion last quarter, but I think we delivered $13.1 billion-ish. And that was just incredible for the quarter and now we're giving guidance. I think it's around $14.5 billion in guidance for next year on the cash flow guidance. So just awesome cash production. Few enterprise software companies have really ever delivered these kinds of numbers and I guess only a couple have ever delivered guidance in the $40 billions which is where we are. And our two newest major products are Data Cloud and Agentforce, AI product line now, we can see as a multibillion-dollar product line. So we're excited to be in that kind of rarefied air of delivering a multibillion-dollar AI product line. We ended this year with $900 million in Data Cloud and AI ARR, growing 120% year-over-year. We've never seen products grow at these levels, especially Agentforce. And Data Cloud and AI, Agentforce, this is now going to be incredible coming into fiscal year '26. As we begin this year and well since our founding, I couldn't be more excited about what's ahead. It's this is a moment like we've just never seen before. And in just a few months, we've seen this addressable market go from hundreds of billions of dollars and I'm sure you saw those ARC slides that got released over the weekend where she said that she thought this digital labor revolution, which is really like kind of what we're in here now. This digital labor revolution, this looks like it's anywhere from a few trillion to 12 trillion. I mean I kind of agree with her. I think this is much, much bigger than software. I mean for the last 25 years, we've been doing software to help our customers manage their data. That's very exciting. I think building software that kind of prints and deploys digital workers is more exciting and you're going to hear some of these incredible stories in a second. Our formula now really for our customers is this idea that we have these incredible Customer 360 apps. We have this incredible Data Cloud, and this incredible agentic platform. These are the three layers, but it's this that it is ... [transcript truncated at 5,000 chars — full text available via API]

Michael Spencer (Executive Vice President of Finance and Strategy and Investor Relations): Thanks, Regina. Good afternoon and thanks for joining us today on our Fiscal 2025 Third Quarter Results Conference Call. Our press release, SEC filings, and a replay of today's call can be found on our website. Joining me on the call today is Marc Benioff, Chair and CEO; Amy Weaver, President and Chief Financial Officer; and Brian Millham, President and Chief Operating Officer. As a reminder, our commentary today will include non-GAAP measures. Reconciliations between our GAAP and non-GAAP results and guidance can be found in our earnings materials and press release. Some of our comments today may contain forward-looking statements that are subject to risks, uncertainties, and assumptions, which could change. Should any of these risks materialize or should our assumptions prove to be incorrect, actual company results could differ materially from these forward-looking statements. A description of these risks and uncertainties, and assumptions and other factors that could affect our financial results is included in our SEC filings, including our most recent report on Forms 10-K, 10-Q, and any other SEC filings. Except as required by law, we do not undertake any responsibility to update these forward-looking statements. And with that, let me hand the call over to Marc. Marc Benioff (Chair and CEO): Thank you, Mike, and I appreciate everyone being on the call today. We have a lot of exciting topics to cover, and I hope you enjoyed your Thanksgiving. We're thrilled about the quarter's results, which showed strong revenue performance, operating margin, cRPO, and cash flow. However, it's not just the numbers that we find exciting at Salesforce. While the financials are impressive, the real interest lies in the advancements in our technology. I’m eager to discuss that with you. Before diving in, let's reflect on the significant financial transformation we've experienced over the past few years. Brian and Amy will elaborate on how we are redefining success and delivering financial value for our customers while achieving remarkable outcomes. This is about more than just another successful quarter; we are on the brink of a revolutionary transformation. We are witnessing the emergence of digital labor. For the last 25 years, Salesforce has assisted companies in managing and sharing information, evident across our product line in sales, service, marketing, commerce, and more. Recently, we've created a brand-new market—the market for digital labor—which is much more expansive and exciting than the data management market. Salesforce is now the leading provider of digital labor, and this is merely the beginning, powered by autonomous AI agents. This development is fundamentally altering how businesses function and how we view our industry. With Agentforce, we are not just envisioning the future but actively delivering it. Last week, Agentforce went into production, and we secured 200 deals, with an impressive pipeline for future transactions. The momentum is unlike anything we’ve ever seen, representing a shift where productivity is no longer reliant on workforce growth but rather on intelligent technology that scales without limits. Agentforce signifies the next evolution of Salesforce, where AI agents collaborate with humans, enhancing their capabilities and delivering unparalleled speed. We’ve already implemented this technology across our entire support organization, establishing a robust agentic layer throughout the company. This sets the stage for a complete digital transformation worldwide, where robots will soon work alongside humans. The impact of this transformation is already evident. These agents are not mere tools; they are collaborators, operational 24/7 to analyze data, make decisions, and take action. Imagine enterprises able to manage millions of customer interactions daily, with Agentforce resolving issues, processing transactions, and anticipating customer needs, allowing humans to concentrate on strategic initiatives and building meaningful relationships. Companies like large hospitals or hotels will benefit from agents and robots working side by side, delivering a glimpse of a future that is already unfolding. With Agentforce, we’re paving the way for a new era of digital labor across all industries. The implications are profound. Economic growth has traditionally relied on expanding the human workforce, but as labor stagnates globally, Agentforce opens a new path forward, blending scale and efficiency for our customers. They are already experiencing this evolution, with Agentforce managing service cases, resolving issues, processing leads, and optimizing marketing campaigns at an unprecedented scale, 24/7. During Dreamforce, we witnessed a strong demand from our customers, who built over 10,000 agents in just three days. Since then, we've continued our world tour, generating thousands more agents globally, empo ... [transcript truncated at 5,000 chars — full text available via API]

Mike Spencer (Executive Vice President of Finance and Strategy and Investor Relations): Good afternoon. Thanks for joining us today on our fiscal 2025 second quarter results conference call. Our press release, SEC filings and a replay of today's call can be found on our website. Joining me on the call today is Marc Benioff, Chair and CEO; Amy Weaver, President and Chief Financial Officer; and Brian Millham, President and Chief Operating Officer. As a reminder, our commentary today will include non-GAAP measures. Reconciliations of our GAAP and non-GAAP results and guidance can be found in our earnings materials and press release. Some of our comments today may contain forward-looking statements that are subject to risks, uncertainties and assumptions, which could change. Should any of these risks materialize or should our assumptions prove to be incorrect, actual company results could materially differ from these forward-looking statements. A description of these risks, uncertainties and assumptions and other factors that could affect our financial results is included in our SEC filings including our most recent report on Forms 10-K, 10-Q and any other SEC filings. Except as required by law, we do not undertake any responsibility to update these forward-looking statements. And with that, let me hand the call over to Marc. Marc Benioff (Chair and CEO): All right. Thanks so much, Mike. And thanks, everyone, for being on the call. We got so many exciting things to talk about today, and we're so excited to be with you. And we're also getting really excited for Dreamforce, so looking forward to that. A year ago on this call, we talked about two amazing transformations. We're transforming Salesforce for as we were talking about the short and the long term, which was really code words for really addressing our financials, but really looking at this incredible AI opportunity. And now we look at a year later, I just couldn't be more excited about how these two transformations are driving the success of the company. And really, I don't think I've been more excited about the history of Salesforce and now the future of Salesforce. And how well-positioned we are for the future. And you can see it in our numbers with strong performance across revenue, cash flow, margin, and CRPO. The numbers are beyond my expectation in the quarter. You can see that it's pretty awesome. You can also see the incredible innovation in our product and engineering teams that are delivering the success of our customers, and we're going to talk about a whole different kind of Salesforce today, a different kind of architecture and a product that we didn't even talk about on the last earnings call, that is going to be fundamental to our future and a manifestation of our decade of AI leadership, which is Agent Force. Now, just in a few weeks, we're going to kick off Dreamforce. And I hope all of you are planning to be there, the largest AI event in the world, with more than 45,000 trailblazers in San Francisco. This year, Dreamforce is really becoming Agent Force. It's a funny thing about Agent Force; even one of our very top executives in engineering sent me a text last week and said, 'Hey, should we be renaming the company from Salesforce to Agent Force?' because we're all getting so excited about Agent Force. I told Mike that I really want to make sure all of you are there and to do what he can to put together an analyst briefing at Dreamforce. I gave him a huge budget to really motivate everyone, because I think this is going to be a moment that everyone is going to have to see in person to understand what is going on. We're going to show our new Agentforce agents and how we've reimagined enterprise software for this new world of autonomous AI. Every customer I want to get every customer who comes to Dreamforce to turn agents on while they're there. So many of the customers, of course, are already using our applications, and of course, we're automating all our customer touch points. That's our Customer 360, and we've been talking now for the last couple of years about how we've really built this phenomenal Data Cloud that has really become our fastest-growing, most exciting product ever up until one that we're about to talk about, which is to help our customers amalgamate all the data that they need to get their AI act in order. This involves getting their data and metadata integrated and then federated to other data sources, and then this critical third tier, which is the first call that we've ever talked about, which is these agents. This idea that you're not just going to have sales agents and service agents; you probably heard, maybe saw on CNBC, we're building the agents for Workday. We're going to be building custom agents for so many of you as well with Agentforce, because it is a development platform as well as this incredible capability to radically extend your sales and service organizations. When you arrive at the Dreamforce campus ... [transcript truncated at 5,000 chars — full text available via API]