Salesforce NYSE: CRM reported what executives described as an “outstanding” fiscal 2027 first quarter, highlighting double-digit revenue growth, margin expansion, strong cash flow and accelerating adoption of its Agentforce artificial intelligence products.
Chair and CEO Marc Benioff said Salesforce delivered “record revenue” and “record deals” in the quarter, with revenue of $11.13 billion, up 13% year over year on a nominal basis and 12% in constant currency. Current remaining performance obligation, or cRPO, was $33.6 billion, up about 14% nominally and 13% in constant currency.
The company reported a non-GAAP operating margin of 34.8%, up 250 basis points from a year earlier, and a GAAP operating margin of 21.1%, up 130 basis points. Operating cash flow totaled $6.7 billion.
Agentforce adoption drives management’s narrative
Benioff framed the quarter around Salesforce’s push into what it calls “agentic” AI, saying Agentforce is “the biggest growth opportunity” for customers and the company since Salesforce brought CRM to the cloud.
He said Agentforce annual recurring revenue is now greater than $1 billion. Combined with Data 360 and Informatica Cloud, Salesforce has $3.4 billion in AI and data ARR, according to Benioff. He also said 50% of Agentforce and Data 360 bookings came from existing customers expanding their commitments.
Salesforce processed 28.6 trillion tokens in the quarter, up 152% quarter over quarter, and converted those into 3.8 billion “agentic work units,” up 111% quarter over quarter, Benioff said. He described those metrics as evidence of customer adoption of the company’s AI products.
Benioff said Agentforce has been deployed across Salesforce’s Customer 360 applications, including service, sales, marketing and commerce. On Salesforce’s own help site and phone support line, he said Agentforce has autonomously handled 4 million inquiries over about 15 months, now double the volume handled by human agents.
In sales, Benioff said Agentforce Sales worked 220,000 leads autonomously in the quarter, generating $42 million in pipeline. He also highlighted Salesforce’s acquisition of Qualified and the integration of Piper, its sales development representative agent, noting that more than 700 customers are using Piper.
Customer examples include PenFed and UCLA Health
The call featured appearances from customers using Salesforce’s AI tools. James Schenck, president and CEO of PenFed Credit Union, said the institution has reduced its technology platforms from about 400 to 12 strategic partners and now runs its call center, mobile, web and branches on Salesforce.
Schenck said PenFed has 76 agents running across operations, mortgages, IT and HR. In the call center, he said an “Agent Wingman” tool is expected to save nearly $1.6 million this year, while decreasing call handle time by 10%, reducing after-call work times by 50% and reducing held calls by 40%.
Representatives from UCLA Health also discussed their use of Agentforce. A UCLA Health representative said the organization consolidated onto one instance of Health Cloud and built on it with Marketing Cloud, Data 360 and Agentforce. The first customer-facing chatbot is being used as a virtual concierge to help patients find providers, answer general inquiries and navigate clinical trials information.
Pallavi Mynampati, director of enterprise analytics at UCLA Health, said the organization is approaching AI with healthcare operational challenges in mind, including how to support healthcare workers and help patients access care faster. UCLA Health said it stood up its first agent use case within eight months and is evaluating potential integrations with MyChart and back-office functions.
Capital returns and guidance updated
Chief Operating and Finance Officer Robin Washington said Sales, Service and Slack represented more than 60% of first-quarter net new annual order value. She said bookings for Salesforce’s premium A1E and A4X SKUs, which are anchored in Sales and Service and include agentic capabilities, grew nearly 60% year over year.
Washington said Q1 revenue outperformance was driven by Informatica’s on-premises business and professional services timing, while cRPO growth reflected momentum in Agentforce, Data 360 and Slack. Those gains were partially offset by softness in Commerce Cloud and Tableau, she said.
Salesforce also emphasized capital returns. Washington said the company began a $25 billion accelerated share repurchase, representing half of its $50 billion share repurchase authorization. Combined with the buyback program, diluted share count declined 10% year over year in the quarter. The ASR reduced Q1 share count by 103 million shares and increased non-GAAP EPS by $0.23 and GAAP EPS by $0.14, she said.
For fiscal 2027, Salesforce raised the midpoint of its revenue outlook to a range of $45.9 billion to $46.2 billion. The company continues to expect subscription and support growth of about 11% year over year in constant currency. Salesforce reiterated non-GAAP operating margin guidance of 34.3% and adjusted GAAP operating margin guidance to 20.6%, which Washington said was largely driven by higher restructuring.
The company now expects operating cash flow and free cash flow to grow 4% to 5% year over year, reflecting an approximately five-point headwind tied to debt issuance connected to the accelerated share repurchase. For the second quarter, Salesforce guided for revenue of $11.27 billion to $11.35 billion, representing about 10% growth in constant currency, and cRPO growth of about 13% in constant currency.
Executives address back-half growth and Headless 360
During the question-and-answer session, Morgan Stanley analyst Keith Weiss asked how Salesforce could support confidence in second-half organic subscription revenue acceleration given that cRPO had been in line with guidance and Tableau and Commerce Cloud were weighing on results.
Washington said Salesforce expects first-half net new annual order value growth to outpace annual order value growth, leading to a reacceleration in core revenue growth in the second half of fiscal 2027. Chief Revenue Officer Miguel Milano pointed to large-deal activity, saying Salesforce secured 98 deals with more than $1 million in net new annual contract value in the quarter. He said seven of the top 10 deals added new seats, and six of the top 10 were unlimited enterprise license agreements that included Flex Credits.
Executives also discussed Headless 360, which Benioff described as one of the quarter’s most important announcements. Patrick Stokes, president and chief marketing officer, said the strategy is designed to make it easier to implement and use Salesforce through APIs, MCP servers and other tools, allowing customers to access Salesforce capabilities in workflows such as Slack, Claude or ChatGPT.
Srinivas Tallapragada, president, chief engineering and success officer, said Salesforce processed nearly 1 trillion API calls on its core platform in the quarter and has seen demand for headless access as customers seek to use Salesforce “in their flow of work” while retaining security, permissions and compliance controls.
Slack highlighted as AI collaboration surface
Slack was another major focus of the call. Benioff said Slack accounted for nearly half of Salesforce’s million-dollar-plus wins in the quarter, up 80% year over year. He also said Slack agentic work units grew nearly 350% quarter over quarter and predicted that “in two years, there’ll be more agents using Slack than people.”
Milano said Slackbot has improved productivity at Salesforce and described Slack as a key surface for both builders and knowledge workers to access applications and agents. He added that the Slack business is seeing strong bookings growth and “very little attrition.”
Benioff closed the discussion by saying Slack is having “its absolute moment,” tying its momentum to Salesforce’s broader AI and agentic enterprise strategy.
About Salesforce NYSE: CRM
Salesforce, founded in 1999 and headquartered in San Francisco, is a global provider of cloud-based software focused on customer relationship management (CRM) and enterprise applications. The company popularized the software-as-a-service (SaaS) model for CRM and has built a broad portfolio of products designed to help organizations manage sales, service, marketing, commerce and analytics through a unified, cloud-first platform.
Core offerings include Sales Cloud for sales automation, Service Cloud for customer support, Marketing Cloud for digital marketing and engagement, and Commerce Cloud for e-commerce.
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