Salesforce (CRM) delivered a first quarter that exceeded Wall Street expectations on earnings and revenue, while also lifting its full-year profit forecast, yet the reaction from investors was muted as shares fell following the update.
For the quarter ended 30 April, revenue reached $11.1 billion, up 13% year on year, or 12% in constant currency. Subscription and support income, which remains the core of the business, climbed 14% to $10.6 billion, supported in part by the inclusion of Informatica, which contributed $444 million during the period.
Profitability strengthened sharply. GAAP diluted earnings per share rose 52% to $2.42, while non-GAAP diluted EPS increased 50% to $3.88, comfortably ahead of analyst expectations of $3.13. Operating performance also improved, with adjusted operating income reaching $3.87 billion and margins expanding to 34.8%.
A key focus for investors remains the company’s contracted future revenue pipeline. Remaining performance obligations rose 11% to $67.9 billion, while current remaining performance obligations increased 14% to $33.6 billion. These figures suggest continued demand, although the pace of growth has not accelerated.
Salesforce highlighted momentum in its artificial intelligence and data offerings, with annual recurring revenue from its Agentforce and Data 360 platforms reaching nearly $3.4 billion. The company described Agentforce as a central pillar of its enterprise AI strategy, positioning it across the Customer 360 suite as businesses increasingly integrate automated agents into workflows.
Chief executive Marc Benioff described the period as a record quarter for revenue and deal activity, pointing to expanding use of agent-based systems across industries. The company continues to argue that AI adoption is not replacing its core software model but enhancing it through new consumption-based products.
Shareholder returns were a major feature of the quarter, with $27.5 billion returned through dividends and buybacks, including $27.1 billion in share repurchases and a newly announced $25 billion accelerated buyback programme, reinforcing Salesforce’s emphasis on capital return alongside continued investment in growth.
Despite the strong headline performance, guidance was more mixed, with second quarter revenue expected between $11.27 billion and $11.35 billion, slightly below analyst expectations of $11.36 billion, while non-GAAP earnings per share guidance of $3.25 to $3.27 was broadly in line.
For the full fiscal year, the company raised its non-GAAP EPS outlook to between $14.06 and $14.12, ahead of previous estimates, alongside revenue guidance of $45.9 billion to $46.2 billion.
The market response reflected the tension between stronger profitability and cautious near-term revenue expectations, with shares slipping around 3% after the announcement.
Over the past year, Salesforce stock has remained under pressure, with broader concerns around software demand and the potential impact of AI-driven tools on traditional enterprise software models continuing to weigh on sentiment.
