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CRM Q1 Earnings Top Estimates, Revenues Rise Y/Y on ARR Milestone
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Key Takeaways
CRM posted Q1 non-GAAP EPS of $3.88, up 50% Y/Y, on revenues of $11.13B ( 13%).
CRM said Agentforce ARR topped $1B as subscription and support revenues rose 13.9% to $10.59B.
CRM raised FY27 revenue view to $45.9-$46.2B and launched a $25B accelerated share repurchase.
Salesforce, Inc (CRM - Free Report) delivered a solid first-quarter fiscal 2027 non-GAAP earnings of $3.88 per share, up 50.4% year over year. The bottom line beat the Zacks Consensus Estimate by 24.4%.
Salesforce’s earnings surpassed the Zacks Consensus Estimate in each of the trailing four quarters, with an average surprise of 9.5%.
Revenues rose 13.3% year over year to $11.13 billion and exceeded the consensus mark by 0.68%. Results reflected continued customer demand for Salesforce’s agentic offerings, with Agentforce ARR surpassing the $1 billion milestone.
Salesforce’s Q1 Performance in Detail
Subscription and support revenues (95.1% of total revenues) increased 13.9% year over year to $10.59 billion, accounting for the bulk of total revenues. Professional services and other revenues (4.9% of total revenues) totaled $540 million, indicating relatively stable services activity during the quarter.
Salesforce, Inc. Price, Consensus and EPS Surprise
Within the updated revenue disclosure framework, Agentforce Apps revenue was $6.91 billion, while Data 360, Headless Platform and Other contributed $3.68 billion. Regionally, the Americas (65% of total revenues) generated revenues of $7.23 billion and grew 11.8% year over year. Europe (24.7% of total revenues) delivered revenues of $2.75 billion, reflecting year-over-year growth of 17.8%, while Asia Pacific (10.25 of total revenues) contributed revenues of $1.15 billion, up 12% year over year.
Profitability also improved. Non-GAAP operating income totaled $3.87 billion, up 22% from the year-ago quarter’s $3.17 billion. Moreover, the non-GAAP operating margin expanded 250 basis points to 34.8%, supported by operating leverage and disciplined spending. Management emphasized productivity gains from the internal adoption of AI tooling, even as it continued to invest in go-to-market capacity.
Salesforce’s Balance Sheet & Other Details
Salesforce exited the fiscal first quarter with cash, cash equivalents and marketable securities of $8.93 billion, down from $9.57 billion at the end of the previous quarter. CRM generated an operating cash flow of $6.70 billion and a free cash flow of $6.56 billion in the first quarter.
As of April 30, the current remaining performance obligation (Crpo) was $33.6 billion, up 13.5% year over year. The company returned $27.5 billion to shareholders during the quarter, including $27.1 billion in share repurchases and $365 million in dividends. CRM also launched a $25 billion accelerated share repurchase program, with an upfront delivery of 103 million shares, which management said boosted both GAAP and non-GAAP per-share results in the quarter.
Salesforce Lifts FY27 Revenue Outlook
Looking ahead, Salesforce raised the midpoint of its fiscal 2027 revenue outlook to $45.9-$46.2 billion. The Zacks Consensus Estimate for CRM’s fiscal 2027 revenues is pegged at $46.1 billion, indicating year-over-year growth of 10.89%.
The company reiterated non-GAAP operating margin guidance of 34.3%, reflecting higher restructuring.
For the second quarter, Salesforce expects revenues of $11.27-$11.35 billion and non-GAAP earnings of $3.25-$3.27 per share. The Zacks Consensus Estimate for CRM’s second-quarter fiscal 2027 revenues is pegged at $13.18, indicating year-over-year growth of 5.25%.
Management expects momentum in Agentforce, Data 360 and Slack to continue, while noting that Marketing and Commerce weakness, along with softer Tableau bookings and renewals, remains a key item to watch.
The Zacks Consensus Estimate for Analog Devices’ fiscal 2026 earnings has moved upward by 6.4% over the past seven days to $12.41 per share, indicating an increase of 59.3% year over year. Analog Devices' shares have climbed 53.7% in the year-to-date period.
The Zacks Consensus Estimate for Amphenol’s 2026 earnings is pegged at $4.76 per share, revised upward by 47 cents over the past 30 days and suggests a year-over-year jump of 42.5%. Amphenol shares have increased 3.8% in the year-to-date period.
The Zacks Consensus Estimate for Monolithic Power Systems’ fiscal 2026 earnings has been revised upward to $24.05 per share from $21.64 over the past 30 days. Monolithic Power Systems shares have increased 78.8% in the year-to-date period.
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CRM Q1 Earnings Top Estimates, Revenues Rise Y/Y on ARR Milestone
Key Takeaways
Salesforce, Inc (CRM - Free Report) delivered a solid first-quarter fiscal 2027 non-GAAP earnings of $3.88 per share, up 50.4% year over year. The bottom line beat the Zacks Consensus Estimate by 24.4%.
Salesforce’s earnings surpassed the Zacks Consensus Estimate in each of the trailing four quarters, with an average surprise of 9.5%.
Revenues rose 13.3% year over year to $11.13 billion and exceeded the consensus mark by 0.68%. Results reflected continued customer demand for Salesforce’s agentic offerings, with Agentforce ARR surpassing the $1 billion milestone.
Salesforce’s Q1 Performance in Detail
Subscription and support revenues (95.1% of total revenues) increased 13.9% year over year to $10.59 billion, accounting for the bulk of total revenues. Professional services and other revenues (4.9% of total revenues) totaled $540 million, indicating relatively stable services activity during the quarter.
Salesforce, Inc. Price, Consensus and EPS Surprise
Salesforce, Inc. price-consensus-eps-surprise-chart | Salesforce, Inc. Quote
Within the updated revenue disclosure framework, Agentforce Apps revenue was $6.91 billion, while Data 360, Headless Platform and Other contributed $3.68 billion. Regionally, the Americas (65% of total revenues) generated revenues of $7.23 billion and grew 11.8% year over year. Europe (24.7% of total revenues) delivered revenues of $2.75 billion, reflecting year-over-year growth of 17.8%, while Asia Pacific (10.25 of total revenues) contributed revenues of $1.15 billion, up 12% year over year.
Profitability also improved. Non-GAAP operating income totaled $3.87 billion, up 22% from the year-ago quarter’s $3.17 billion. Moreover, the non-GAAP operating margin expanded 250 basis points to 34.8%, supported by operating leverage and disciplined spending. Management emphasized productivity gains from the internal adoption of AI tooling, even as it continued to invest in go-to-market capacity.
Salesforce’s Balance Sheet & Other Details
Salesforce exited the fiscal first quarter with cash, cash equivalents and marketable securities of $8.93 billion, down from $9.57 billion at the end of the previous quarter. CRM generated an operating cash flow of $6.70 billion and a free cash flow of $6.56 billion in the first quarter.
As of April 30, the current remaining performance obligation (Crpo) was $33.6 billion, up 13.5% year over year. The company returned $27.5 billion to shareholders during the quarter, including $27.1 billion in share repurchases and $365 million in dividends. CRM also launched a $25 billion accelerated share repurchase program, with an upfront delivery of 103 million shares, which management said boosted both GAAP and non-GAAP per-share results in the quarter.
Salesforce Lifts FY27 Revenue Outlook
Looking ahead, Salesforce raised the midpoint of its fiscal 2027 revenue outlook to $45.9-$46.2 billion. The Zacks Consensus Estimate for CRM’s fiscal 2027 revenues is pegged at $46.1 billion, indicating year-over-year growth of 10.89%.
The company reiterated non-GAAP operating margin guidance of 34.3%, reflecting higher restructuring.
For the second quarter, Salesforce expects revenues of $11.27-$11.35 billion and non-GAAP earnings of $3.25-$3.27 per share. The Zacks Consensus Estimate for CRM’s second-quarter fiscal 2027 revenues is pegged at $13.18, indicating year-over-year growth of 5.25%.
Management expects momentum in Agentforce, Data 360 and Slack to continue, while noting that Marketing and Commerce weakness, along with softer Tableau bookings and renewals, remains a key item to watch.
Zacks Rank and Other Stocks to Consider
Currently, CRM carries a Zacks Rank #2 (Buy).
Analog Devices (ADI - Free Report) , Amphenol (APH - Free Report) and Monolithic Power Systems (MPWR - Free Report) are some other top-ranked stocks that investors can consider in the Zacks Computer and Technology sector. Analog Devices, Amphenol and Monolithic Power Systems each carry a Zacks Rank #2 at present. You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
The Zacks Consensus Estimate for Analog Devices’ fiscal 2026 earnings has moved upward by 6.4% over the past seven days to $12.41 per share, indicating an increase of 59.3% year over year. Analog Devices' shares have climbed 53.7% in the year-to-date period.
The Zacks Consensus Estimate for Amphenol’s 2026 earnings is pegged at $4.76 per share, revised upward by 47 cents over the past 30 days and suggests a year-over-year jump of 42.5%. Amphenol shares have increased 3.8% in the year-to-date period.
The Zacks Consensus Estimate for Monolithic Power Systems’ fiscal 2026 earnings has been revised upward to $24.05 per share from $21.64 over the past 30 days. Monolithic Power Systems shares have increased 78.8% in the year-to-date period.