Salesforce delivers strong Q1, ups outlook

Salesforce reported better-than-expected first quarter results and raised its outlook. The company said its AI and data annual recurring revenue in the quarter was $3.4 billion.

The company reported first quarter earnings of $2.42 a share on revenue of $11.1 billion, up 13% from a year ago. Non-GAAP earnings for the quarter were $3.88 a share.

Wall Street was expecting Salesforce to report first quarter non-GAAP earnings of $3.13 a share on revenue of $11.06 billion.

CEO Marc Benioff said, “agentic AI is the biggest growth opportunity for our customers and for Salesforce.” He added that Salesforce delivered 3.8 billion Agentic Work Units, a metric the company introduced last quarter. See: Salesforce's Agentic Work Unit: What you need to know

As for the outlook, Robin Washington, President and Chief Financial and Operating Officer at Salesforce, said the company expects organic revenue acceleration in the second half of fiscal 2027. Salesforce is projecting second quarter revenue of $11.27 billion to $11.35 billion, up 10% to 11%, with non-GAAP earnings of $3.25 a share to $3.27 a share. For fiscal 2027, Salesforce projected revenue of $45.9 billion to $46.2 billion with non-GAAP earnings of $14.06 a share to $14.12 a share..

That guidance was ahead of Wall Street estimates.

• Salesforce launches Agentforce Operations
• Why Salesforce Headless 360 matters
• Why Slackbot is so strategic to Salesforce

By the numbers:

• Informatica cloud ARR was $1.1 billion.
• Agentforce ARR was up 205% from a year ago.
• The company processed more than 28.6 trillion tokens to date and 1 trillion API calls across core products in the first quarter.
• Agentforce apps subscription and support revenue in the quarter was $6.91 billion with Data 360, Headless Platform and other at $3.68 billion. Salesforce revamped how it segmented its revenue.

On a conference call, Benioff said:

• "We announced Headless 360 to make all of Salesforce accessible through our MCP clients, APIs, CLA prompts, Headless 360 is bringing together the humans, agents and headless platforms, so you can use Salesforce with any coding agent across any surface. It's going to speed implementations, drive consumption, more actions, more workflow, more data, more intelligence, all compounding across Salesforce. We're meeting our customers where they are. Since launch in April, we've already processed 4.5 million MCP calls into our platform."
• "Slack was nearly half of our million plus wins this quarter, up 80% year over year. All of our apps are Slack first."
• "For the last couple years, we have not been loading up a lot more engineers. It's been mostly flat. The reason it's been mostly flat is because we have been using AI to create more efficiency for our engineers. With these new coding agents, we're seeing even more dramatic capabilities, so that that's a key part of our margin story is that we're not hiring more engineers. We're mostly expanding in sales."

Washington noted:

• Informatica boosted the quarter. "With Informatica as part of Data 360, we're already unlocking synergies with revenue growth accelerating since the acquisition. This is the flywheel we laid out at our Investor Day, and it's working. Those signals show up in the headline numbers. Q1 revenue came in at $11.13 billion, up 12% in constant currency, ahead of our guide. The outperformance was driven by Informatica's on-prem business and professional services timing. cRPO ended the quarter at $33.6 billion, up approximately 13% in constant currency, driven by continued momentum in Agentforce, Data 360, and Slack."
• AI coding tool productivity. "In Q1, AI coding tools enabled us to double the amount of features and codes shipped year-over-year, while simultaneously reducing incidents and defects."
• Marketing, Commerce and Tableau weaker. "Our Q2 and FY '27 revenue guidance reflect continued momentum in Agentforce, Data 360, and Slack, partially offset by ongoing weakness in Marketing and Commerce and increased softness in Tableau bookings and renewals. We also expect greater license revenue volatility with the addition of Informatica on-prem revenue to our business."