CRM - Earnings call transcript Q1 2023

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Evan Goldstein

Thank you, Emma. Hello, everyone, and thanks for joining us for our fiscal 2023 first quarter results conference call. I'm Evan Goldstein, Senior Vice President of Investor Relations.

Our press release, SEC filings and a replay of today's call can be found on our IR website at www.salesforce.com/investor. With me on the call today is Marc Benioff, Chair and Co-CEO; Bret Taylor, Vice Chair and Co-CEO; Amy Weaver, Chief Financial Officer; and Gavin Patterson, Chief Revenue Officer.

commentary primarily our terms. in reminder, a today be will non-GAAP As between results earnings in non-GAAP GAAP and guidance release. Reconciliations and found and our can be press our

are today are actual which to company factors be should and change. that these forward-looking statements. affect forward-looking A of our our and assumptions of subject could may any results and materialize of is risks, materially uncertainties other uncertainties comments our most results statements SEC Some from these financial incorrect, that Form recent risks subject Should assumptions differ to our assumptions, to contain report filings or could in these our description in on risks, included XX-K. included prove

to to Before I hand the call excited Mike Salesforce. welcome over I'm to Spencer Marc,

Marc. welcoming ago. meaningful let you to lead working one benefits hand I new Gavin investment of over to thank Mike in Microsoft. Amy, our at many for And that, me rewarding taking on of career. Investor is Relations Bret, at enable supporting has you many allowing Thank Mike Investor development. he to you of to Leading years the and experiences me at IR you, as be for know, most joined strategic Marc, a of has of with the Salesforce, the will Salesforce. community X career Salesforce Relations. rotations one call my product And planning that many the It previously here led role familiar been As is organization, over in

Marc Benioff

It's so Evan, and much, on well deserved. Thanks promotion. your hey. so Well, congratulations

Chief on excited with this to the more and working have we and And voice that out worked familiar to to in excited excited Mike thrilled the done thank you. before, welcome headquarters, more to number incredible to other as I Salesforce be be is these cannot not role Salesforce. also friend call be that You've incredible of Salesforce, there, with we're a new from Information of Mike. at folks Mike Officer and Atlanta And take Chief new our looking you for on teams, Officer really Spencer new including leading for for you. I'm forward and be could Chief as know a phenomenal Commercial and of new should last about X And job years, agreeing Mike we this is executives based going well and our closely because many and our Officer. Accounting a our

to really kind of such for a see center Salesforce. of become post-pandemic So thing cool gravity our Atlanta a in reality

welcome just QX our we review to was the it there, Mike fact, had exciting and In operations to team.

as on our team, with So whirlwind you, it's you're just me this let that, for been about management to call. hear a tell

had numbers, -- We've you you data. weeks. It's And We on healthy. week, watching We're doing tell in, were All -- road. Tokyo. in personally or We the just we've this carefully see can a business last have were I Switzerland. that were customers. We the you And last the hundreds met awesome. and quarter. incredibly of our the been are in well. Australia. we also I can And was with economic X great was And hundreds that been X as that all Atlanta. of the over New QX see you, been know I York. I in Davos, pretty think, can you I was can't in in all in world. really we Sydney, we is

material broader you in. are any world just all far, impact economic we're of not so from the And that seeing

has proven incredibly look you Our incredible strong, years, resilient Salesforce on very business model. is based over last demand to demand if be and where XX environment this the

model. tell made share we XX flow growing Salesforce CRM on recessions the we our I consecutive through model, us power why obligation, -- revenue customer measure these year storms you There's amazing. which in cycle, crises of contract. have in a and markets and think We impact did, to emerges we us RPO, revenue travels our delivered time. we of lost over $X.X why more in crisis I'll have an we a every revenue, and up again then, incredible contracts, customers continue that changes comes in that our where for In money, up We segments continues billion it's still been and had We our success, When my pretty through on to the through well, model made every -- Tracker. us kind dollar, relevant just according also future more possible all monthly just have although impacted on all saw strength we've certainly performance we the momentum strength over QX, because foreign it the all the and dollar in you, crashes for to I a of Software I ever. no dot-com can weather of And more been of of CRM IDC’s our go a know it's and a of we've that year-over-year, I financial we through business currency focus And quarters all Xth technology investors than wouldn't you think lot the focus we've have and And our than #X the now century, success the their didn't And sure X/X model, became month. always yet us. able unexpected think but quarter, that every stronger And of kinds I'm really strategic so remains quarter. amazing. you today. you row, business that In right might we a our our strong the and experienced our and to Salesforce durability in remaining XXXX, watched almost of because any and grow agree, than $XX financial the that's in give have, it had, XX% better of well, global of even as storm, in the were have kind now we we technology and in year-over-year. in last business an had pandemics cash to over the and nearly is very quarter the results, billion fluctuations can durable XX% and see, the these stronger really that we the strengthened business, structure, in

Foreign a headwind flow quarter, though, about is, was in in it exchange and $X.X here the operating core quarter, that cash very well revenue the year-over-year, movements resulted in million we something up of Operating the reflecting anticipated. margin business XX% across $XXX well, could performance year-over-year, billion XX.X%. have have not strong

have I gave total Turning additional to headwinds the you great our this was by mentioned, of a up is the It year we as headwind team, implications first revenue the called for I end our guidance. And I time in since since It said, million I Japan volatility. just first but fall, for roll Well, couldn't the as an ago. year-over-year, -- Investor to the mean increased $XXX in you in was was end. just very in guidance I faced the the the U.S. million example, be of an tourist historic decline tourist revenue a a Japan, for something this our exchange presented a to $XXX to our the Day. good market And I've XX% a Japanese revenue from weeks seen. time I in to But year-over-year going Japan dynamic we our foreign in it Japan. give believe the it's weeks a quarter fourth couple in value To X never the ago, of dollars. fact, be

$XXX 'XX result billion to or XX% revenue of guidance as by billion So lowering we're $XX.X our about these year-over-year. growth $XX.X headwinds, fiscal million a to

fiscal XXX operating of guidance we're an XX.X%, margin, basis to our points year-over-year. 'XX raising points expansion non-GAAP XX basis For by

you it as for and from bottom top said, of flow committed and demand growth I quite our part consistent hear plan to you're Gavin drive healthy. from and performance. And as this to incredibly we're cash of from to about remains margin others environment this all Customer and platform, both long-term have line from well, Amy as know, and model As as that XXX and Bret we

even some hear couple Our these excited to growth are as well. just tell customers FX well, only the very of by And and in quarter, of I'll but Department you, you be tell companies evidenced relationships to amazingly hundreds the strong, product that get stories our with incredible you, met we've and Farm not last as these productivity State from weeks. able also like of the and customer Commerce, as they're these from incredible of Goodyear customers, I'll

are say that digital better no than future. a for investing company That in companies to transformation, is time So industry, is digital every we every company, for trailblazers this now let be experienced our me positioned a every the XX,XXX is when government help was in who and over to Bret. something to fully not world. of grateful And I could millions last making more and week, our we difference the Davos customers ohana, are transform

Bret Taylor

Marc. Thanks,

headwinds, the As see and foreign despite demand exchange of and demonstrate clouds, strong our across power and the great our Marc our we had we results strategy. our really regions said, industries quarter, a unprecedented our

economy. relevant our Our more platform as in digital Customer products and connect new invest their to this to savings before, cost are drive with customers XXX in than companies ever

the Hyperforce is is scale technology artificial predictions incredible. is our levels to enabling billion Our global trust per doing with with day, that differentiated, are Einstein deeply unmatched and just industry. intelligence, reach in XXX which our customers now Einstein of infrastructure

is ecosystem Our unparalleled.

creating diversified our economic industries, we're focus durable. for trailblazers, have sustained the flow business continues model, in performance as regions, XX ensuring economic IDC million disciplined $X.X top our It's face of on is any said, and And business, customers both partners. We driving line our leadership expansion. cash margin trillion is And for and cycle. finally, estimates operating of execution, to team resilient lines our in will which what impact Marc over across be

over we've to we've the and customers And week, As to theme from the been Singapore road, the last execute is the is example ADT the ADT, our our met and that Marc great virtual digital our said, pandemic, customers, the visits despite accelerated first CEOs transformation at our full with, have all in reconnecting with I Service Cloud I they York used trailblazers volatility economy. Davos to alarm quarter. ahead, in dramatically steam met one-on-one from One leader global XXX,XXX all this systems. the New during continue trend partners. home common service been its on XX in the

goals. saw growth, XX% growth relevant Customer XX% and decided a continues replaced last have year to Chrysler the productivity We formed trying they in as the great avoided of whether for French Customer XXX. best-in-class is across to This across the relevant Customer in to single of and all Americas, customer Cloud, had the wins entire quarter, like they momentum And Salesforce. quarter, result, accelerate, of PSA in personalized XX% X,XXX Stellantis. the a on the drive and XXX lowered increasingly service while with trucks Stellantis, apps in strong and company and the with to EMEA And Sales our increase are in customer year-over-year truth source XX% Cloud and all And growth, growing while achieving more customers from region cases. sending than well. their out DoorDash globe. or technicians year-over-year all drive higher you're costs As to We our Group, is They their Sales profitability APAC. the $X.X cloud standardize with was delivering satisfaction. company carbon which sustainability They scale across platform to footprint, engagement now our meet merger productivity. billion promise service. the in technology, Fiat lowered X their surpassing strong XX% every platform its between every XXX your in

Field quarter. Cloud, in Our was Service now a State great a to Cloud with $X.XX at in Sales Financial our entire Cloud this billion Service year-over-year Farm, success revenue events. story quarter. Salesforce support Cloud Services time Service the customer grew Service during experience, customer, platform They're combining their especially enhance to long catastrophic end-to-end XX% Cloud,

Bose like strong Colgate and with see with Cloud to Marketing continue also We our momentum Palmolive. customers

Our harder systems Marketing it's around Cloud Platform, CDP and from new the it's new to CMOs fastest-growing privacy the hundreds investment Data has is become operating with the and globe. engagement world, consumer before, products cookie-less become built personalized and ever management one significant even in and than natively. more drive ever all they unify sources as This regulations navigate our changes growing in relevant is to measuring of trust Customer we've campaign driving compliance using made has and and customer released. in our which different information of the Bose engagement, multichannel to marketing, mobile real-time their hyper

We so XX% YETI, that rapidly Together, Commerce in the continuing quarter. in the at L'Occitane digital stood year-over-year Commerce wins trend accelerated also Cloud and Goodyear, saw the and pandemic. Marketing commerce

Bose and to digital in multi-cloud deal. Tableau continues like MuleSoft quarter retailer Rocket a Lookers our continue Data part some included every deepen the interaction, Group, existing the our the the wins largest Our to foundational with and in for in XXX the data for UK clouds, was Motor including in and year-over-year Mortgage. relationships ADT, grew auto XX% Tableau fuel quarter. NTT also and be and including every Customer of is top MuleSoft quarter, customers of deals Tableau, MuleSoft

year. than get This Slack we're expectations, of As you encouraged Slack MuleSoft's have annually. exceed strong know, back continues making, past for Amy the also UK and couple with we issues quarters. we've our quarter Justice. the go-to-market been car the say and see into XX% over by of spending wins working self-driving will a some through in growth the progress revenue of to more the of Cruise that fourth $XXX,XXX company, I'm pipeline the but than specifics, was on to we the more consecutive Ministry half I'm with excited customers motion

see industry to strong financial momentum including continue care, health verticals, XX consumer our and also We goods across services, manufacturing.

X this for so trailblazers, helping employees part of need they million Our the of our our times. our deals uncertain navigate grateful industry-specific top and partners XX agility resilience XX our XX,XXX of clouds were for to quarter. provide innovation, I'm all these with customers and our

Salesforce unrivaled success, this community drives success our their as digital financial customer advisor. Our trusted why our and choose is customers

Now success talk over some customer from about of to Gavin to stories the quarter. the

Gavin Patterson

I start about want for everyone, demand by being and call environment Thanks, strong on Bret, the thank you, in. today. talking to the we're

our customer the resilience And and Blue work-from-anywhere realize there Brightspeed, stay or relationships Americas, saw digital every world, to grew in billion platform. transformational multi-cloud efficiencies the as in to Ferguson, they're of need as in distributor the customers products. all customers. XX% real to this digital this and transformation [SHA our growth Hotels], on to interaction Marc plumbing In momentum and their with investments Customer we XXX We're grew our heating quarter. and to strong out California California, every in These invest a their deals conversations, environment, XXX Salesforce and the their across technology $XX In U.S., Shield Bret with in play the from the urgency Salesforce. advisors customers incredible digital productivity time, with Customer X trusted or create we're growth they even investments. seeing in Covered Asia As new year-over-year region. volatile road of turning are the Workday, transformations, in and been deals, again why more I've sense Davos. continuing said, is and longer-term that recently digital in companies this experiences making We quarter my That's a of seeing clouds at And in gains, of their in most across the need and strong this competitive. business. to Europe, pipeline same

largest view supplier, able the Looking expanded Ferguson And a more XXX significantly during been the a to its quarter, at little organization. Ferguson them chain sales relationships. of customer relationship using has its Motor Group, only of supply single detail, amazing in market deliver their front-end and subscribers. experience of for to on professional reduce not digital million our In one EMEA, media their to services the XX grow They're and to had standardizing heart Salesforce the speed Lookers and Esprit in and give with companies challenges to France. IT associate costs but an with Ferguson wins significant their we also telecom Customer first, time

the I we UK Group. Motor a with As great had win in mentioned, Lookers

single car a efficiency for driving their Lookers Customer unified and overall customers. centers XXX, the the within platform, experience improving contact their and buying With has dealerships

Turning to APAC.

LG amazing also MuleSoft to like and with with is deepen to Salesforce increase and In a Bank, prospective Mahindra had Tableau NTT, current with our chose Kotak win. They engagement Experian. relationships Serasa brands continue Marketing improve LatAm, marketing significant We we which customers Cloud great and and a win our to efficiency.

orders And Department it and They growing has to as and entities to the billion platform, other incredible administration a Telecommunications turned the merchants, for of of applicants tribal In options and more few help their quarter, and state real Salesforce digital billion Salesforce grown fans, strategy value watched since them X.X that grateful fan for and leverage pandemic. fulfilled and is help and brand experience Salesforce million and And Administration the professional financial convert X you X trust. its across the thousands enable Commerce and to to Cloud new fan selected alone by to low-cost respond team details create rate, manage technology nonphysical customer grants increase and broadband attract and engagement of integrated and insights U.S. support they're every National Formula business merchants our These customers engagement the within to today, implementation. quarter, Marketing to broadband create will fan new will to on powered inclusion experience the Service wrap last just at Information Cloud an mobile-first from Sales $XX issues bring more viewers. both to continued to services up, communities. the in to to DoorDash an and and channel, and of dashes. Salesforce an customer Cloud, faster than using eligible by end-to-end the Formula to and from Cloud U.S. physical quality we're Amy, revenue. into quarter service XXX strong tremendously improve to of They quarter. customers' DoorDash over in address more the MuleSoft to and selected hundreds are across time examples our and discuss a Sales also the in efficiently. partnership needs territories,

Amy Weaver

and Great. you, good Gavin, Thank afternoon, everyone.

As pipeline and remains Bret results had strong quarter, financial robust. said, and we this our Marc

We customers are positioned in well to serve uncertain this macroenvironment. our

'XX, continued fiscal some results XX% annually, through the in our go or more XX% in Total of top line the currency. currency. with A of This year-over-year, $XXX,XXX growth for again Let's XX% our was to The $X.XX revenue grew accelerating quarter constant QX QX, key with number to Cloud million $XXX quarter. The Sales spending in first of outperformed XX% few year-over-year. with of highlights than $XXX compared customers million. commentary. Slack beginning in expectations guide revenue constant in year-over-year our billion. momentum revenue QX up from for XX% is

an needs. strong UK and high performance Our our strength saw demand the We in XX a both And product out-of-the-box was X with customers deals geographic products in with industry's included and quarter. in from industry's out particular to are of specific providing EMEA top perspective, this remain France. solutions

strong we on business call. MuleSoft. new year-over-year changes go-to-market as an driven a year by Now Total through update increased X% prior comparison, on last to revenue discussed lower-than-expected work we the the provide against organizational

year-over-year. Total than remains performance a X.X%. still value from MuleSoft's And XX% billion, all revenue between $XX performance billion, or remaining As represented future products. obligation, up strong, QX, fiscal and mentioned, on benefits Slack XX% approximately year-over-year these $XX.X ended in 'XX. constant contract representing attrition obligation, and is at average, in revenue Marc under CRPO, we XX% volatility total in mentioned, our approximately at the company scale in up as of to approximately anticipate resulting XX% currency. And Current seeing reminder, performance contract record lows the pipeline line was and or recognized strong strategic our product of with RPO as at X% relevance X% period, This more Bret -- X guidance. MuleSoft's of half points reflects core with customers. our quarterly in back again, growth, the changes remains remaining our relationships portfolio that our of and in our QX

margin operating to Turning for quarter. the

GAAP margin $X.XX. non-GAAP $X.XX. EPS non-GAAP For operating strategic EPS and was as non-GAAP $X.XX was was EPS GAAP benefited and the XX.X%. accounting QX QX, company's Mark-to-market investments by approximately both

to cash Moving flow.

flow cash million, flow $X.X up billion, was XX% QX, in operating billion, up $X.X CapEx resulting year-over-year. For $XXX of cash was free year-over-year. XX%

Now our exchange impact on to to call foreign the guidance, before like financials. that turning to is our I'd attention having

of euro, all dollar a into FX are quarter the are impact to for to the the to currency reminder, we against as exposures provided our increased the 'XX, on such, Japanese transparency the pound, we fiscal currencies. last strengthen yen dollar. guidance. to lesser and Australian As our year of these extent, has Since outlook continued And this providing the British primary Great a our

guidance. Now let's get to that

the For full we year-over-year $XXX million. bringing top the year-over-year year, last headwind change $XXX FX in represents headwind an total on provided incremental million quarter, $XXX million to currencies the the of

As 'XX of such, approximately revenue growth $XX.X or billion XX% to guiding to we are now billion fiscal year-over-year. $XX.X

a $X.X from billion to guidance Slack. continues contribution Our assume

QX year-over-year. expect revenue XX% of We or billion $X.X to growth approximately billion $X.XX

headwind $XXX from Slack. contribution from and year-over-year million Our $XXX QX FX includes guidance a revenue million a

growth and now represents deliver rate as contribution FX. from year-over-year. is a headwind CRPO normalized. Slack’s we growth includes approximately XX% quarter a QX, to This fifth QX expect reminder, And of to For the X-point therefore, CRPO of year-on-year

of $X.XX $X.XX. of loss and $X.XX GAAP expect non-GAAP to EPS We $X.XX negative share to negative per

and of full to of $X.XX OIE we recall EPS that EPS GAAP our assume adjustments both and investment no $X.XX $X.XX our strategic year, please $X.XX. guidance And mark-to-market of the further to EPS For non-GAAP portfolio. expect

years, to operating from raising includes This M&A. by to across continued respect margin, announce we basis basis a This and our margin. fiscal we disciplined increase organization. over represents to continuing of are XXX points basis am expenses And pleased to basis over basis points I focus be very that all are because driven XX.X%. a margin decision-making operating points an the on XX improve guidance there year-over-year the profitability XXX company, hedge operating revenue XXX to points committed points to 'XX regional With guidance as tends generally Turning headwind are FX, the same in expansion X non-GAAP to XXX our our of a long by in currencies, term. and natural to

FX although such, anticipate our fiscal a we've headwinds year. don't for operating seen revenue, the full currently material to we As to margin impact

our 'XX to cash year record and generation, on approximately cash flow, well cash of fiscal XX% another drive remain way our are to to growth XX% of flow operating reiterating year-over-year. Moving we we guidance flow

to In costs. law from associated capitalization headwind of requiring taxes guidance cash assume X-point a addition, certain R&D continues with changes the tax our

Salesforce To the close, and navigate gives a to revenue their strategic of the are confidence to cash to of we businesses. of year. our in macroenvironment, customers our of resulting product fiscal we're business us relationships and durability XX% come transform continue relevance fiscal uncertainty in changing to in this excited is for the portfolio. testament seeing of model, our these of demand to flow The the the economy. CapEx help X% strength growth 'XX, expect XX% from customers approximately This in are our continuing customers while our is there in We to to approximately free

Emma, I his Now team with open leadership all in friendship the we up, last new specifically joining his let with have incredible Evan and thank wrap us. let's his say to who the before best do to And me the X welcome I'm and line to them role. that, for Mike wish IR officially delighted Spencer, want partnership the years, over And for questions.

Operator

[Operator Instructions] JPMorgan. Your of from Mark the today line Murphy question with first comes

Mark Murphy

Yes. Mark [indiscernible]

Amy Weaver

Amy. this We're lot Mark, you. is hearing Hi, trouble having of a

Mark Murphy

[indiscernible] Apologies

Bret Taylor

on need may to we move Operator, question. the to next

Amy Weaver

Yes.

Let's on. move

Let's come Mark. if to can see we back

Operator

Certainly.

Keith Morgan question from the of Your next Weiss Stanley. comes line with

Keith Weiss

QX. in probably One and Two share that quarter is been high investors nice market the of Really questions. maturation about that part the the Salesforce Sales sort have most This on of has. portfolio Cloud. worried

of guys accelerating maybe on able programmatic growth. it initiatives Can you that the margins on expecting basis? operating what's better to you see And in reinvigorated operating us operating solutions margin or little to up a anyone Is those something enabling You dig one after something there press Amy expenses. that's talk are going calling have has then that driving I it? this little operating a guys some headcount growth about quarter. think drive you particular kind really go-forward a Can was for been or item? about line bit some bit that that of in slower vertical the Is margins. to better don't margins? There's enabling on speculation the in

Bret Taylor

today in growth. Not it in you XX% but only Parker XX and said, think years is Cloud Sales relevant the ever quarter, year-over-year currency ago, that as grow about as XX%, excited really threshold it symbolic constant is the has I which still We're did it Yes. or been. product built as grew Marc

growth last we This enables teams introduced speaks I Revenue this and our company. late to the integration our relevant example, Cloud Cloud to faster, an sales that every range a our Sales think, are innovation year, make Intelligence, teams and reimagine boost cash to to organic Sales foremost, is chance coming be from an a rep innovation between their engineering even at but our broader enable not that to entire only to give bringing portfolio customers. strategy customers first which the sales Customer implementations, more collect of efficient is to deep and it XXX together and to Tableau really

for the of to innovative that wins Cloud of always this look we've like to their strategy. reimagine DoorDash, era excited really be So you work, or flexible most next this in approach about about opportunity think an to When about we're generation platform talked management. continues sales this innovation you there's in management at the selling and our lead and of ADT opportunity quarter our Sales some customers for

So the talk an think, continue market-leading teams, we platform. dog to on I continuing I also, say operating want to old about the margin. are tricks, about excited Amy, position. just teach to CRM what new are innovate And congratulations leading and is, to who our world's engineering really

Amy Weaver

love Sure. to. I'd

So, for question. the hi, thanks Keith,

efficiencies across we're each prioritize look across As their you We've operating It's XX.X% very, decision-making for step very this to the business is of leader not up dollar to on invest. business. margin incremental and to this really getting noted, entire their by asked I really to disciplined really to that raise the investments. the is and unlock any fiscal strategically about make trying result driven single return we pleased really that And the really am This change. for sure to year. every highest up our

on this team. support majority really just to of pace, we're going going truly doing supported hire, This by to You and not roles reiterate, committed are term, stronger as to this priorities. to execution But we But Bret, success the on and want make over applied our our Gavin is leadership on hiring, organization. we being margin, we're much focus and continue entire This the finance-led is I and it is this is will of a hiring. is new by Marc, across initiative. focus in a top again, entire us focusing hires This more that our a asked measured about all a result, the we're our discipline by company. do long that by are customer

Operator

question from next comes Kirk Your the of with Evercore. Materne line

Kirk Materne

economic I don't for might there's Bret, you performed Amy. guidance And be Amy, a the tougher unchanged well or when but know FX. lead to at question take for through to sort second when in you which start wants playbook change any environment, in fiscal this, year these I kept revenue be Salesforce periods? basically mentioned all, guidance economic products of who your to cycles. if getting Marc better wondering then if you in -- would adjusting was go-to-market of terms with to

everybody macro conservatism, the just that wondering more we think Could a on more little a probably bit, backdrop. reflects little bit now uneven where you that days XX ago? I if comment given were versus is guidance maybe

Marc Benioff

that narrative productivity going I robust how the focus it I an think, like Bret, environment in costs. at line change, And can And on and think deliver the We're right selling our said will really for to time, you're strategy top Well, we lower a customer our change. well. advancement. talk will their about more this, we

that, at And drive flexibility has we think -- invented the case well the how the the we retailer We've kind continues about we like this so realized going all in that. important a And here wow, I for Of use give him you walked Brunello you retail imagined you're for the really Today, search is question, can for they're has as was its together? good have relationship customer and question, I it? different Every could been that what And think incredible I like, ever really see these using last platform don't of that that growth. X and in they to X in more an trying do and a have more solution. Sales when it's the slightly you know so would that some asking be really has agent solution. than kind environment mean To really an the was XX% do the is understanding Italian uses I and point do. talked them. AT&T a it working retail I product. Cucinelli point-of-sale was I'm to to Service for in which about Sales heard to than you what come down and a previous of dramatic and this, why want course, Cloud the recently with have gets a to and personal so And has in But week that with it products. is growth. never like every it. store. preparing different of we in product, Gavin, them, in incredible put think store that Salesforce. I remained it's what I and XX% growth all it like Salesforce, strong, you do core customer, serve have said just at again, hey, in like. example different just And of from you see dinner And thought Cloud with growth that to the that I environment customers ago of it's and years today when that Cloud

Gavin Patterson

of facing environment, that Listening what key that. think tailor type word approach and relevance. specific the challenge making is the I sure the in -- you to customers, the are your to they understanding Well, this challenges

and with So in cost customers. used a the cases, with then up our new use Cloud new to is more Sales is Service my we've -- and with earlier, the And said business taking go right many Customer right up taking lead is as very as were that taking of out quarter of comments take or who I multi-cloud to particularly customers the in business customers strong, with clouds. and have way XXX, customers Cloud -- X XX% who this both. we lead, Other

sure actually accordingly. our quarters about tailor we and and customer, it's making where the is we're So messages relevant, productivity going being more the about now period that I last that through think understanding listening important it's to a few transformation than

Marc Benioff

Gavin And the of would slightly team. over matter at is they're I looking work take. environment, and CEO who also FX kind and in was the that Yes. was And talked FX relationships our is of and weekend Stefano of the add at Monaco the Domenicali, about Lamborghini. customer is closely And this the FX going with Volkswagen to different whole a when course, current everybody environment, management we at looking have when and him

have So this. it's times those like at high-quality to nice relationships

Amy Weaver

part your from we're and includes you've from mindful of Great. Look, Kirk, question Marc, we pipeline. feel But Gavin, the second the from that guide. that heard the seeing. our what we're put take Bret, to about volatility. good of uncertain continuing on here about FX macroenvironment, And I'll

believe that circumstances. under I conservative is the guidance so our appropriately And

Operator

Your with question line comes JPMorgan. next of from Mark Murphy the

Mark Murphy

What all survey it it X/X see would try opportunity achieve could our the $X as has to of Bret, you wondering best billion that use work adopted and shown looks budget a ubiquity? conferencing? potential the several if Workspaces of more for the be number Slack be you video to of R&D rivaling any above see this looks employees It do potentially you next Google like years. in I'm huge like do Zoom. by to accelerate with native and have level innovations to Slack And

Bret Taylor

a great question. Well, it's

is in integrate every And in week, a really really when customers e-commerce, As MuleSoft conversation as accelerates and relevant and and single work, it's really and work of Customer other strategic But think entire XXX. how Tableau think represents all amplify innovation, entire in an MuleSoft, our single, Tableau week. digital understand heard more ever than customers it our because like that office either-or about the together all our every our relevant office worker, digital. data, all office. see Davos deciding coming Marc a more before complementary market of they our a this Salesforce back way. days of of it's last systems and complement single I And which of as interaction enables clouds to not relevant. to other, because I their to particularly Gavin the Slack, makes in really our and proposition XXX service, every Slack do each Sales one becomes flexible acquisitions question service complement is for Customer that they isn't sales, our because each create back and every our about customers succeed their office new legacy and value helps because digital Slack, platform the X transformation. is era I really front

is they from Service between Service working from the of Cloud, of our Slack quarter using Cloud management their anywhere. one or that uses investment things and and integrations the in really DoorDash era, our amplify Slack, I'm in most where this fact, lot deployment, one of about is In with Cloud XXX we team our it's a new whether account in Customer to this workforce solutions Cloud shift warming in the succeed actually Service and excited selling Sales their our their case it's past

just XXX standalone excited Slack is invest incredible. just only relevant with So in really But value a not as is Customer is more which I'm excited that Slack the now much building. proposition to our in platform, how

conversation I of we did, think it's to going the acquisitions more and really flexible new it relevant be of one this era best makes in customer ever every work.

Operator

the Your Brad comes from Bank. Deutsche next line question with Zelnick of

Brad Zelnick

generated year. ton of to cash the free start strong Andy, flow. the on a the business Congrats

a You your to of really buying trading need is you and billion stock? Board stock the your attractive consider have cash the back $XX happen balance multiple. and at almost for sheet, to on What would

Amy Weaver

question. the for thanks Brad,

As a you at I you allocation strategy. tell company, will that, not always we've historically, as but know, are looking buybacks, our capital done we

to this cash. capitalize to really on looks the really is all it's a use at Board focus our Right and overall basis, of Our quarterly sheet strengthening of best front opportunities now, on our on of the in us. consistently assess balance

Operator

question Brent Your of from Piper comes with next line the Sandler. Bracelin

Brent Bracelin

around Any the of be I Have relative shift particularly pipeline more the in the any vendors guess this of you to color sort consolidate helpful. to the customer mix appetite customers number seen we're of one multi-cloud vendor cycle. super hear tightening starting from consolidation, to idea the given the of themes is would deals? of business

Gavin Patterson

numbers. board, I'll EMEA, XX% across service marketing in U.S., XX% take a that XX% in region strong the great very one. up numbers, Every great sales quarter APAC. the posted what seen Look, is all posted in cloud, you've

a pipeline had good strong quarter, I look really year. we looks forward, the And of So got as the momentum. for strong the rest we've

is there our times. So If think numbers. see at with moment, all consolidation don't placed. we we're operating environment impacting our But we're customers, cognizant vigilant we a are extremely the of of I But that vendors the we're in. well at

There's sales, case, move the that saw think else We arms. And of customers of the with offer who clouds. of only Salesforce and And and [Maria ones is been full taking in business there an all ADT to if talking I a to nobody quarter. is it is us you with able Black] the service in I example of customer about example from across job story. well. business are XXX marketing. of The great incredible more to that, other XXX. intimate vendors the a Formula consolidation examples from choose the the the relationships. we'll clouds that's doing more is continue is Customer Customer multiple market it, it the some as suite creating the And great example to towards at we've and their driving business both part welcome much that around and of X love

well full very single placed, that. whether XXX, it's sale, the take a advantage to think, cloud it's of So whether Customer I we're

Marc Benioff

relationship of we've Yes. they number number a years, I who over would of Rich add, a a think the Goodyear. really products. someone one I with Kramer, different in deployed was quarter great our highlights built of the that

with deploying this and there great have and our trusted those to really is have every be land go just most vendors, vendors I and consolidation -- will customer they're products our the that few extend opportunity it's just last on a and the Cloud. a some Commerce strategy with. rely tremendous with where augmenting that the and single expand by moment relationships years, and a with having over a they'll they full suite also example Now And we acquisition products of by think

Operator

question Jefferies. the line from of Thill with comes Brent next Your

Brent Thill

digesting in acquisitions? some many in of the asking be many pullback the with philosophy you and and strategy, Marc, past Or M&A you're your are here? given the Do aggressive playbook Slack on change other valuations. the more sticking

Marc Benioff

the valuations. Well, a know number closely watching it's see of rightsizing very can we a all great I on that we're question. markets a and

and suspect we we're But quite us, done we've for strategy long down, for that laid all of think for acquisition out quite time. I kind are a our a while.

with with Slack what many no reality just line finish or can that companies when with is are we acquisitions. comes there's integrate. acquired Demandware, work. acquisition Tableau, There done, MuleSoft, to these -- they realized ExactTarget They of that today. beginning even with first these take not and them. hard right with time We've from of you to the think can you're lot if that Commerce you're Cloud amazing They're I to You see and mentioned with with it surprise you you our your when done, to with the have

our we're ones say that looking It's on focused that of not So really now, right for we just really at playbook not part a any now. would I right doing major integrating have. the We're acquisitions.

We have to a you do lot of primary work want to do to add focus. our that's Amy, that? still. And

Amy Weaver

as M&A it, that's opportunistic our is something say not screen. all tech we're got current you've our but now, I just current companies never never, is Right part strategic are, Marc. on radar Obviously, plans. large-scale think of that and not I No,

Operator

comes the of next with Rangan from Kash Goldman question Your line Sachs.

Kash Rangan

their with with who margin little gives positioning just faster release, Amy. assuring, just and be you what the differently feel is confident and Congratulations What this quarter. we this Marc talk have CEOs, different you is here, on mean, I'm through why on are a mind? to of cycle? so meet get detail for And just to more I so been others great. on wondering you press terrific them on growth one economic you cash multiple to growth basis. the think a about And you there I Certainly, would -- call then And what top do in you've in cycles what confidence? very about this daily cycle? understand you bit flow for I economic a wanted Salesforce's said cycle? something plan

Marc Benioff

quite again, go. growing. we motivated. across entire rate operation, is a is with these I'll I an I'll right stock of focused at Well, last chain same And on across time. changes to market Kash, with X lot Japan, everyone to share, off very when been thing, when the one story. impressed met reviewed number ready customers. customers investing and company the And with These week, expansion, one And customers, how for customers when about same the on growth. new are an CEO, the the consistently of management one or went down looking in industry, issues nimble. team. without think and long foreign Tokyo we They to this product they're of I all same really and or have have in And have that are I a debt about I while a went are. They're heard think, focused rising of strategies very off been went Sydney, you a on sheet. our all to then tell our was It place our Davos all went and or And Sakurada-san. of with Japan exchange They're a the it activity ever of I the with or were moment. we ago, the in they're new incredible with to interest to on interaction -- down they're customer from think Atlanta because level executives to well, expanding areas all, focused of I or their of was different looking lot and it digital I ago weeks insurance let going focused was They've at our speak largest on transformation. large our know I and we having gyrations of economic inflation They with lot and New was X we we've they're now than York, I you this each thing. And amount. us pandemic. now what Everyone has And that was supply At I'm then in market products. we Sompo, tell They're geography, then and flexibility, weeks on Australia, largest our and do their just their was exciting into with balance a been excited of we very shifts. end day, very And just going impressed before. very of we

ability a gave do I over okay, I to next reset everybody pandemic am of think the the decade. about, and now going where think kind the

I we company And and look We years, rebuilt Slack, our us. our every in CDP. run. retooled, team. it's last acquired strategy, strategy. management think how so we the ever, X built being running We largest acquisition at We We the company transformed who's changed their services our augmented professional our

an some decade. come and the think do ready probably next And true you for that experiences we're that that, And example of the meeting want all we're of, were with. about example for So customers is I to in Davos? okay, talk your in Bret,

Bret Taylor

surprised was it one-on-one well. different regions And investments. had really CEOs a in you privilege the about world, much CEO pleasantly industries. just conversations hear leaning Well, from it put different digital into having I are Davos, customers their of to XX how around

the some technologies been companies inflation, businesses, their that some both I company house increased of to avoid really of the increases. digital on has Some focused like chain costs to the and take demand all absorb down some in really consumer a and price beauty the how And then impacted talked by we're goods leave have CEO seen of invest to supply we to as advisor and of continue to and of customers whether productivity, or of on your was focused But investing in we industry. drive digital one vendors and strategic with couple most for trusted in the past to you're the theme them digital years the technology every was all be first the growth. connect really technology CEOs these across time digital the in in to of investing other all

need economy. everyone read customers. relationships, the just advisor cognizant to we Gavin especially headlines with customers said, we said, gaining most on where share our as those relevant will from customers. we're gaining in of the being resilience, form and as that out trusted in each of need times trust the our else, we come being of us, market And our these and that I trusted focused believe that and So as digital Marc And if the same I'm volatility

Marc Benioff

Tableau, Amy, data your connecting I really our major that hear connecting partners connecting and employees connecting through what Bret Slack, customers, with our think it these with Well, themes said our with did hearing. discussions? we're with you well, with are in

Amy Weaver

It's something. to Davos customers hundreds there. opportunity across no other is there's -- with connect of

help a companies things of grow can it. focus the I was looking One more partnerships as and looking heard and for them on are Salesforce both really become for efficient companies efficiency. like they And that do

was So week great it an incredible and opportunity. a

Bret Taylor

Gavin, do want fill you to this?

Gavin Patterson

heard solve I what mean advisor. I have strategic cloud we're relationship problems from that in I think customers full and can full XXX more that of is to previous last Yes. we we were just trusted more And a generally, for Customer We've a a suite because a think solution multiple of that's more and them. cycles. important our week customers more I than got

transformation well. drive efficiency, for is as productivity to that cost issue we've allow growth. that growth, a got solution their if right got it's them So about combination and we've the will If and

about think and placed heard agenda digital and environment. that to and any transformation help is through more narrative around steam of about concerns in our this spite the out even it customers the time again more that that. better we becoming than of it's running time important, I So other -- we're It's relevance, not increasingly the company

Marc Benioff

Yes.

use exist their Thank in signed something One friend we with excited first with that They're that product But they're I'm when single on think expand with Farm, is of bring made I their cases. the Davos, expand agreement with truth Tipsord, And of customers. about good huge didn't of to Michael these able of I them. and that great CEO met excited about But with and the expanding Keith very field service we've because our really the source product. And we to this them. for continues our I'm for think customers course, that now. XXX State all you I take it question. that's to Board even Customer them. journey as new our much Block,

Amy Weaver

Kash, follow on flow. up cash on to your question

should our increase For and is faster cash philosophy margin, revenue as are. increasing we we're FCF our flow, operating our OCF than that which

the that company. I'm make huge of stronger confidence of a cash every margin, this much a passing comes back on a This for fad. innovative both constraints across part on operating this terms believer levels, of In is more the the disciplined not and the is and the And to company. focus growth. focus

our in So is of when my confidence comes stepping up really all to seeing meeting challenge at leaders Salesforce from us. this

Operator

of comes Winslow the Your with last question today Phil Credit line from Suisse.

Phil Winslow

What and vocal along right transformation? transformational big now of they too. the signed of are customers terms are You've about you in there terms in journeys some the clouds. in changes contracts kind team, telling their to center where seen are in from in of vendors we've touched just on focus you've been And on contact marketing also, pretty going obviously I that on because sales, wanted service customer commerce service.

seeing Cloud wonder could through in and your you level customers So you're if us is going I talk forward. conviction Service what just what kind from of

Bret Taylor

service, particularly Customers box. And centers, portfolio. contact expanded service Farm, Service. and think is Thank you. heard I've our do State is we our they continues we with question. really our in customer Field script do when and example And service their about environment, XX% that we increase but of great do ADT so in QX you costs. complete for because not volatile in I trucks the ADT product the customer completeness a field do and sending is service, avoid helps way you I that customers portfolio economic love example really anchor tenant strategy, the portfolio can I XXX to were do largest which we that self-service That's particularly most in is long-standing interactions expanded chat an visits from our of Service think And reflected the reduce the because reduces satisfaction, happier was they ticketing, have Customer be reason time, the managed this like our customers, because And only our the your in reason what they do you virtual out service we customers and costs. the it XXX,XXX of market. Farm. about we digital to do State customers, think, like that a when gave

continues be reasons really the our the customers choose really our goes vendors, Gavin we're to our back our main front strategy consolidate that. about So XXX of completeness as said, excited I'm customers product the And the Customer be of portfolio fact innovation. that excited offerings. portfolio, it our of in look we incredibly to office particular, as entire to And differentiated. customers can again, organic our one for product our is why

Operator

This Q&A I Goldstein, today. Evan back to over turn concludes for call Mr. you. the our

Evan Goldstein

you the Thank today. call on us for joining

Marc Benioff

to you Evan, I great couldn't more want X be congratulate And for on we you. excited years IR. in

we this congratulations it for big the started way props you. end with some let's and So

Evan Goldstein

investor@salesforce.com, the appreciate next any feel And out free you for we at forward us, talking Really quarter. have team. look and Marc reach it. if leadership Thanks, to and to questions

Operator

concludes conference for attending. today's This Thank call. you

You disconnect. may now

Salesforce (CRM) 1 Jun 222023 Q1 Earnings call transcript