• First Quarter Revenue of $3.74 Billion, up 24% Year-Over-Year, 26% in Constant Currency

  • Current Remaining Performance Obligation of Approximately $11.8 Billion, up 23% Year-Over-Year, 24% in Constant Currency

  • Remaining Performance Obligation of Approximately $24.9 Billion, up 22% Year-Over-Year

  • First Quarter Operating Cash Flow of $1.97 Billion, up 34% Year-Over-Year

  • Initiates Second Quarter Revenue Guidance of $3.94 Billion to $3.95 Billion

  • Raises FY20 GAAP Earnings Per Share Guidance to $0.78 to $0.80

  • Raises FY20 Non-GAAP Earnings Per Share Guidance to $2.88 to $2.90

SAN FRANCISCO, Calif. - Jun. 4, 2019 - Salesforce (NYSE: CRM), the global leader in CRM, today announced results for its fiscal first quarter ended April 30, 2019.

“I am thrilled with our results this quarter, and I am especially excited to have delivered record revenue in Q1 and operating cash flow of almost $2 billion, up 34% year-over-year,” said Marc Benioff, chairman and co-CEO, Salesforce. “We have a massive opportunity in front of us and are well-positioned for long-term growth as the world's #1 CRM.”

“Our strong revenue growth in the quarter reflects the strength of our business and the tremendous demand we're seeing from customers worldwide,” said Keith Block, co-CEO, Salesforce. “Companies of every size and industry are undergoing a digital transformation to better serve their customers and they are choosing Salesforce as their partner.”

Salesforce delivered the following results for its fiscal first quarter:

Revenue: Total first quarter revenue was $3.74 billion, an increase of 24% year-over-year, and 26% in constant currency. Subscription and support revenues were $3.50 billion, an increase of 24% year-over-year. Professional services and other revenues were $241 million, an increase of 23% year-over-year.

Earnings per Share: First quarter GAAP diluted earnings per share was $0.49, and non-GAAP diluted earnings per share was $0.93. Mark-to-market accounting of the company’s strategic investments, required by ASU 2016-01, benefited GAAP diluted earnings per share by $0.27 based on the US tax rate of 25% and non-GAAP diluted earnings per share by $0.27 based on our non-GAAP tax rate of 22.5%.

Cash: Cash generated from operations for the first quarter was $1.97 billion, an increase of 34% year-over-year. Total cash, cash equivalents and marketable securities ended the first quarter at $6.38 billion.

Remaining Performance Obligation: Remaining performance obligation ended the first quarter at approximately $24.9 billion, an increase of 22% year-over-year. This includes approximately $500 million related to the remaining performance obligation from MuleSoft. Current remaining performance obligation ended the first quarter at approximately $11.8 billion, an increase of 23% year-over-year, 24% in constant currency.

As of June 4, 2019, the company is initiating revenue, earnings per share and current remaining performance obligation growth guidance for its second quarter of fiscal year 2020. For the full fiscal year 2020, the company is maintaining its revenue and operating cash flow guidance, and raising its non-GAAP earnings per share guidance, previously provided April 15, 2019. The company is also raising its GAAP earnings per share guidance previously provided on March 4, 2019. The guidance below assumes no change to the value of our strategic investment portfolio resulting from ASU 2016-01 as it is not possible to forecast future gains and losses. While historically our investment portfolio has had a positive impact on our financial results, that may not be true for future periods, particularly in periods of significant market fluctuations that affect the publicly traded companies within our strategic investment portfolio. The impact of future gains or losses from our strategic portfolio could be material. In addition, the guidance below is based on estimated GAAP tax rates that reflect the company’s currently available information, and excludes forecasted discrete tax items such as excess tax benefits from stock-based compensation. The GAAP tax rates may fluctuate due to future acquisitions or other transactions.

The following is a per share reconciliation of GAAP diluted earnings per share to non-GAAP diluted earnings per share guidance for the next quarter and the full year:

* The Company's GAAP (loss) earnings per share range includes the impact of the one-time non-cash accounting charge of approximately $200 million resulting from the termination of its reseller agreement with Salesforce.org as previously discussed on April 15, 2019. The Company's GAAP tax provision is expected to be approximately (58%) for the three months ended July 31, 2019 and approximately 37% for the year ended January 31, 2020. The GAAP tax rates may fluctuate due to discrete tax items, future acquisitions or other transactions. The Company's projected GAAP basic and diluted (loss) earnings per share assumes no change to the value of our strategic investment portfolio resulting from ASU 2016-01 as it is not possible to forecast future gains and losses.

** The Company's non-GAAP tax provision uses a long-term projected tax rate of 22.5%, which reflects currently available information and could be subject to change.

*** The Company's projected non-GAAP basic and diluted (loss) earnings per share assumes no change to the value of our strategic investment portfolio resulting from ASU 2016-01 as it is not possible to forecast future gains and losses.

For additional information regarding non-GAAP financial measures see the reconciliation of results and related explanations below.

Quarterly Conference Call

Salesforce will host a conference call at 2:00 p.m. (PT) / 5:00 p.m. (ET) today to discuss its financial results with the investment community.  A live web broadcast of the event will be available on the Salesforce Investor Relations website at www.salesforce.com/investor.  A live dial-in is available domestically at 866-901-SFDC or 866-901-7332 and internationally at 706-902-1764, passcode 7177678.  A replay will be available at (800) 585-8367 or (855) 859-2056 until midnight (ET) July 4, 2019.

About Salesforce

Salesforce, the global leader in CRM, empowers companies to connect with their customers in a whole new way. Salesforce has headquarters in San Francisco, with offices in Europe and Asia, and trades on the New York Stock Exchange under the ticker symbol "CRM." For more information about Salesforce, visit: www.salesforce.com.

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"Safe harbor" statement under the Private Securities Litigation Reform Act of 1995:  This press release contains forward-looking statements about our financial and operating results, which may include expected GAAP and non-GAAP financial and other operating and non-operating results, including revenue, net income, diluted earnings per share, operating cash flow growth, operating margin improvement, expected revenue growth, expected current remaining performance obligation growth, expected tax rates, the one-time accounting non-cash charge that will be incurred in connection with the Salesforce.org combination; stock-based compensation expenses, amortization of purchased intangibles, shares outstanding, market growth and sustainability goals.  The achievement or success of the matters covered by such forward-looking statements involves risks, uncertainties and assumptions. If any such risks or uncertainties materialize or if any of the assumptions prove incorrect, the company’s results could differ materially from the results expressed or implied by the forward-looking statements we make.

The risks and uncertainties referred to above include -- but are not limited to -- risks associated with the effect of general economic and market conditions; the impact of geopolitical events; the impact of foreign currency exchange rate and interest rate fluctuations on our results; our business strategy and our plan to build our business, including our strategy to be the leading provider of enterprise cloud computing applications and platforms; the pace of change and innovation in enterprise cloud computing services; the seasonal nature of our sales cycles; the competitive nature of the market in which we participate; our international expansion strategy; our service performance and security, including the resources and costs required to avoid unanticipated downtime and prevent, detect and remediate potential security breaches; the expenses associated with new data centers and third-party infrastructure providers; additional data center capacity; real estate and office facilities space; our operating results and cash flows; new services and product features; our strategy of acquiring or making investments in complementary businesses, joint ventures, services, technologies and intellectual property rights; the performance and fair value of our investments in complementary businesses through our strategic investment portfolio; our ability to realize the benefits from strategic partnerships, joint ventures and investments; the impact of future gains or losses from our strategic investment portfolio, including gains or losses from overall market conditions that may affect the publicly traded companies within the company's strategic investment portfolio; our ability to execute our business plans; our ability to successfully integrate acquired businesses and technologies; our ability to continue to grow unearned revenue and remaining performance obligation; our ability to protect our intellectual property rights; our ability to develop our brands; our reliance on third-party hardware, software and platform providers; our dependency on the development and maintenance of the infrastructure of the Internet; the effect of evolving domestic and foreign government regulations, including those related to the provision of services on the Internet, those related to accessing the Internet, and those addressing data privacy, cross-border data transfers and import and export controls; the valuation of our deferred tax assets and the release of related valuation allowances; the potential availability of additional tax assets in the future; the impact of new accounting pronouncements and tax laws; uncertainties affecting our ability to estimate our tax rate; the impact of expensing stock options and other equity awards; the sufficiency of our capital resources; factors related to our outstanding debt, revolving credit facility, term loan and loan associated with 50 Fremont; compliance with our debt covenants and lease obligations; current and potential litigation involving us; and the impact of climate change.

Further information on these and other factors that could affect the company’s financial results is included in the reports on Forms 10-K, 10-Q and 8-K and in other filings we make with the Securities and Exchange Commission from time to time.  These documents are available on the SEC Filings section of the Investor Information section of the company’s website at www.salesforce.com/investor.

Salesforce.com, inc. assumes no obligation and does not intend to update these forward-looking statements, except as required by law.

© 2019 salesforce.com, inc.  All rights reserved.  Salesforce and other marks are trademarks of salesforce.com, inc.  Other brands featured herein may be trademarks of their respective owners.

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Salesforce is the global leader in Customer Relationship Management (CRM), bringing companies closer to their customers in the digital age. Founded in 1999, Salesforce enables companies of every size and industry to take advantage of powerful technologies—cloud, mobile, social, internet of things, artificial intelligence, voice and blockchain—to create a 360° view of their customers. For more information about Salesforce (NYSE: CRM), visit: www.salesforce.com.

Any unreleased services or features referenced in this or other press releases or public statements are not currently available and may not be delivered on time or at all. Customers who purchase Salesforce applications should make their purchase decisions based upon features that are currently available. Salesforce has headquarters in San Francisco, with offices in Europe and Asia, and trades on the New York Stock Exchange under the ticker symbol “CRM.” For more information please visit https://www.salesforce.com, or call 1-800-NO-SOFTWARE.