Sign in

You're signed outSign in or to get full access.

SI

Salesforce, Inc. (CRM)·Q3 2025 Earnings Summary

Executive Summary

  • Salesforce pre-announced its Q3 FY26 earnings date (Dec 3, 2025) and will discuss results and the just-closed Informatica acquisition; Q3 revenue guidance stands at $10.24–$10.29B and non-GAAP diluted EPS guidance at $2.84–$2.86 .
  • Q2 FY26 delivered strong execution: revenue $10.236B (+10% YoY), GAAP operating margin 22.8%, non-GAAP operating margin 34.3%, and CRPO $29.4B (+11% YoY) .
  • Data Cloud & AI ARR accelerated to ~$1.2B in Q2 (+120% YoY) as Agentforce adoption scaled; management reiterated full-year FY26 non-GAAP margin guidance and raised FY26 operating cash flow growth to ~12–13% .
  • Salesforce completed the acquisition of Informatica on Nov 18, 2025 and will provide transaction and guidance implications with Q3 results; management targets faster accretion and positions the combined data foundation as a core enabler for agentic AI at scale .
  • S&P Global consensus estimates could not be retrieved at this time; as context, third-party indicates consensus EPS ~$2.85 and revenue ~$10.27B for Q3 FY26, but use with caution and prioritize company guidance .

What Went Well and What Went Wrong

What Went Well

  • Q2 FY26 beat across key metrics: revenue $10.236B (+10% YoY), CRPO $29.4B (+11% YoY), GAAP OM 22.8%, non-GAAP OM 34.3% (“tenth consecutive quarter” of margin expansion) .
  • AI momentum: Data Cloud & AI ARR surpassed ~$1.2B (+120% YoY) with >6,000 paid Agentforce deals and 40% of Agentforce bookings from existing customers; management cites “agentic enterprise” as core thesis .
  • Capital return: Salesforce returned $2.6B in Q2 via buybacks and dividends and expanded repurchase authorization by $20B (total $50B) .

Management quotes:

  • “We outperformed on Q2 revenue… and CRPO… and the AI and data product line is up 120% year over year.”
  • “We exceeded all our financial targets while achieving our tenth consecutive quarter of operating margin expansion.”

What Went Wrong

  • Segment/geo softness persisted: management highlighted weakness in Marketing and Commerce and measured performance in certain geographies (UK, Japan at times), despite strong SMB and specific EMEA pockets .
  • CRPO growth impacted by prior measured sales performance (starting Q2 FY23), muting the pace of acceleration despite normalized bookings .
  • S&P Global consensus estimates unavailable via tool; limits precise beat/miss framing ahead of Q3 actuals. See Estimates Context section for disclosure .

Financial Results

Consolidated P&L, EPS, Margins (Q1 → Q2 → Q3 Guidance)

MetricQ1 FY26Q2 FY26Q3 FY26 Guidance
Revenue ($USD Billions)$9.829 $10.236 $10.24–$10.29
GAAP Diluted EPS ($)$1.59 $1.96 $1.60–$1.62
Non-GAAP Diluted EPS ($)$2.58 $2.91 $2.84–$2.86
GAAP Operating Margin (%)19.8% 22.8% N/A
Non-GAAP Operating Margin (%)32.3% 34.3% FY26: 34.1% (guide)
CRPO ($USD Billions)$29.6 $29.4 Slightly >10% YoY growth (guide)

Subscription & Support Revenue Breakdown (by Offering)

Offering ($USD Millions)Q1 FY26Q2 FY26
Sales$2,131 $2,267
Service$2,334 $2,458
Platform & Other$1,963 $2,084
Marketing & Commerce$1,325 $1,365
Integration & Analytics$1,544 $1,516
Total Subscription & Support$9,297 $9,690

KPIs and Cash Flow

KPIQ1 FY26Q2 FY26
CRPO ($USD Billions)$29.6 $29.4
RPO Total ($USD Billions)$60.9 $59.9
Operating Cash Flow ($USD Billions)$6.476 $0.740
Free Cash Flow ($USD Billions)$6.297 $0.605
Data Cloud & AI ARR ($USD Billions)>$1.0 >$1.2
Capital Returned ($USD Billions)$3.0+ (buybacks+dividends) $2.6

Guidance Changes

MetricPeriodPrevious GuidanceCurrent GuidanceChange
Revenue ($B)Q3 FY26Initiated at $10.24–$10.29 $10.24–$10.29 Maintained
CRPO YoY GrowthQ3 FY26~10% (nominal); ~9% CC Slightly above 10% (nominal); slightly above 9% CC Slightly raised phrasing
GAAP Diluted EPS ($)Q3 FY26$1.60–$1.62 $1.60–$1.62 Maintained
Non-GAAP Diluted EPS ($)Q3 FY26$2.84–$2.86 $2.84–$2.86 Maintained
Revenue ($B)FY26$41.0–$41.3 (raised at Q1) $41.1–$41.3 (low end raised) Raised low end
GAAP Operating Margin (%)FY2621.6% 21.2% (includes restructuring) Lowered
Non-GAAP Operating Margin (%)FY2634.0% 34.1% Raised
Operating Cash Flow Growth (%)FY26~10–11% ~12–13% Raised
Free Cash Flow Growth (%)FY26~9–10% ~12–13% Raised
Sub & Support Revenue Growth (CC)FY26~9% CC ~9% CC reiterated Maintained

Earnings Call Themes & Trends

TopicQ1 FY26 (May 28)Q2 FY26 (Sep 3)Current Period (Pre-Release)Trend
Agentforce adoption & “agentic enterprise”>8,000 deals, 4,000 paid; internal Slack agents and help portal at scale >12,500 deals (>6,000 paid), 40% bookings from existing customers; pilots moving to production Will feature on Q3 call; expanded FedRAMP High for public sector Accelerating adoption
Data Cloud scale22T records ingested; Data Cloud +120% ARR to >$1.0B Data Cloud & AI ARR >$1.2B (+120% YoY) Informatica closes to enrich data governance/MDM Scaling; strategic depth improves
Capital allocationDividend and buybacks; disciplined M&A (Informatica signed) $20B repurchase expansion; $2.6B returned in Q2 Informatica closed; faster accretion targeted Balanced “Trinity” continues
Segment/geography mixSMB strength; some retail/public sector measured SMB/midmarket strength; UK/Japan constrained at times; strong pockets in NL/CH Expect continued SMB/midmarket focus Mix shifting to SMB/mid
Government/public sectorMomentum; FedRAMP plans Army wins; Agentforce for Public Sector FedRAMP High certified; gov opportunity “monster” Increasing focus

Management Commentary

  • Benioff on agentic enterprise: “Every single one of our customers is becoming an AgenTic enterprise.”
  • Washington on margins: “Q2 non-GAAP operating margin up 60 bps and GAAP up 370 bps, marking a tenth consecutive quarter [of] expansion.”
  • Milano on pipeline: “Pipeline is growing in the high teens… big deals approaching 20% growth.”
  • Benioff on data foundation: “Every AI transformation is a data transformation… Informatica, MuleSoft, Data Cloud… together… AI Foundation.”
  • Informatica close: “You have to get your data right to get your AI right… Informatica… turns fragmented enterprise data into context.”

Q&A Highlights

  • Growth vs margins: Management reiterated commitment to margin/cash flow discipline while expanding AE capacity (~22% YoY target) to drive bookings acceleration in growth segments (SMB/midmarket) .
  • Consumption model: New “Flex credits” and consumption focus to monetize Agentforce/Data Cloud; tight engineering–success loop to drive adoption and determinism at scale .
  • Public sector opportunity: FedRAMP High enables broader gov deployments; recent Army wins and agent-enabled digital front door initiatives .
  • Capital allocation “Trinity”: Buybacks, dividends, and targeted M&A (Informatica and tuck-ins) supported by durable free cash flow .
  • Segment/geography dynamics: Strength in SMB/midmarket and specific geos; measured retail/public sector; ongoing marketing/commerce softness acknowledged .

Estimates Context

  • S&P Global consensus estimates were unavailable via our data tool at this time; therefore, we cannot anchor beat/miss comparisons on S&P ahead of Q3 results .
  • As external context only, MarketBeat lists Q3 FY26 consensus EPS ~$2.85 and revenue ~$10.27B; treat as indicative and defer to company guidance and S&P for formal comparisons .

Key Takeaways for Investors

  • Expect Q3 results and updated FY26 guide Dec 3, 2025; near-term stock moves likely hinge on delivery vs $10.24–$10.29B revenue and $2.84–$2.86 non-GAAP EPS guidance ranges .
  • The Informatica close is strategically significant: immediate narrative boost on data governance/MDM integration for agentic AI; management signaling accelerated accretion vs initial timeline .
  • AI monetization flywheel strengthening: Data Cloud & AI ARR >$1.2B (+120% YoY) and Agentforce adoption scaling; watch consumption metrics and expansion deals as leading indicators .
  • Operating discipline intact: tenth straight quarter of margin expansion; FY26 non-GAAP margin target nudged up to 34.1%, FY26 OCF growth raised to ~12–13% .
  • Mix shift to SMB/midmarket and public sector: management adding AE capacity where demand is strongest; FedRAMP High broadens TAM in gov .
  • Segment watch: continued weakness in Marketing & Commerce offsets momentum in Service/Platform; track segment contributions in Q3 print .
  • Beat/miss framing will depend on actuals vs S&P consensus; given tool limits today, reassess post-release for precise estimate comparison .

Appendix: Document Status for Q3 FY26

  • Q3 FY26 earnings date announced (Dec 3, 2025); press release timing available .
  • Q3 FY26 8-K 2.02 and earnings call transcript not yet filed/listed in our catalog as of this writing; will synthesize upon publication [ListDocuments returns none for 8-K 2.02 in window].
  • Relevant Q3 period press release: “Salesforce Completes Acquisition of Informatica” (Nov 18, 2025) .