Marc Benioff

Co-Founder, Chairman & CEO, Salesforce Inc

$CRM Salesforce Q1 2027 Earnings Conference Call

🎥 May 27, 2026 📺 EARNMOAR ⏱ 68m

05/27/2026 Q&A: 32:11 Salesforce, Inc. provides customer relationship management technology services that connect companies ...

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About Marc Benioff

Marc Benioff, the co-founder, chairman, and CEO of Salesforce, has been actively discussing the company's financial performance and its strategic pivot toward an "agentic enterprise." In the company's FY27 first quarter earnings call, Benioff reported that Agentforce, Salesforce's autonomous agent platform, has become an $800 million business, and he raised the midpoint of the company's FY27 revenue guidance to between $45.9 billion and $46.2 billion. He also announced a $25 billion accelerated share repurchase program, part of a larger $50 billion buyback authorization, which he described as a move to return shareholder value during a period of "incredible low prices." Benioff has characterized the current market environment as a "SaaS apocalypse," but stated that it is "not my first" such cycle, expressing confidence in Salesforce's position. Benioff has emphasized Slack's role as the central user interface for the AI ecosystem, stating that "Slack became the user interface to Salesforce but even to the whole AI ecosystem." He described Salesforce's strategy as a stack that includes large language models, a federated data layer (including the newly acquired Informatica), applications like sales and service, and the Agentforce orchestration layer. He has also discussed the importance of the Model Context Protocol (MCP), an open-source standard from Anthropic, as a foundational piece of AI infrastructure. In conversations about AI's broader impact, Benioff expressed concern about potential labor disruption from AI, stating he worries that it could operate "faster" and be "broader across the economy" than previous technological shifts. On political matters, Benioff described himself as "an American" rather than a Democrat or Republican, and advocated for "economic entanglement" with China as a path to a "no conflict deal."

Source: AI-verified profile updated from Marc Benioff's recent appearances. Browse all interviews →

Transcript (157 segments)

✨ AI-enhanced transcript with speaker attribution

Operator0:00

At this time, I would like to welcome you to the Salesforce first quarter fiscal 2027 conference call. This conference is being recorded and all lines have been placed on mute to prevent any background noise. After the speaker's prepared remarks, there will be a question and answer session. At this time, I would like to turn the call over to Mike Spencer, executive vice president of finance. Sir, you may begin.

Mike Spencer0:21

Good afternoon and thanks for joining us today on our fiscal 2027 first quarter results conference call. Our press release, SEC filings, and a replay of today's call can be found on our website. Joining me on the call today is Marc Benioff, chair and CEO, Robin Washington, chief operating and finance officer. We also have Patrick Stokes, president and chief marketing officer, Miguel Milano, president and chief revenue officer, and Shini Tal Patta, president and chief engineering and success officer, joining us for the Q&A portion of the call. Some of our comments today may contain forward-looking statements that are subject to risks, uncertainties, and assumptions, which could change. Should any of these risks materialize, or should our assumptions prove to be incorrect, actual company results or outcomes could differ materially from these forward-looking statements. A description of these risks, uncertainties, and assumptions, or other factors that could affect our financial results or outcomes is included in our SEC filings, including our most recent reports on forms 10K, 10Q, and any other SEC filings. Except as required by law, we do not undertake any responsibility to update these forward-looking statements. As a reminder, our commentary today will include non-GAAP measures. Reconciliations between our GAAP and non-GAAP results and guidance can be found in our earnings materials and press release. And with that, let me hand the call over to Mark.

Marc Benioff1:38

All right. Fantastic. Thanks so much, Mike. I'm so excited to be here with everybody and great to do our second video earnings call with you. It's really great. It's a gorgeous day in San Francisco and we're going to have a great time here with you. We've even got a couple customers joining us which we're really excited about. Well, I think as everybody can see this was really an outstanding quarter for Salesforce. We have delivered record revenue, record deals and just incredible cash flow. And of course, I think you know we've also returned record levels to our investors. We're going to talk about that and how important that is especially during this unusual time. So, we're going to come into that. And also, by the way, we also mentioned we have some record token counts. I think we're going to talk about how we processed 28.6 trillion tokens up 152% quarter over quarter, no greater example of the tremendous adoption of these new Agentic products by our customers and how we've converted those into 3.8 billion Agentic work units. Agentic AI - it's the biggest growth opportunity for our customers, for us at Salesforce. And since we brought CRM into the cloud, we're just seeing tremendous new innovation every single day. And you can see it in our products. You can see it in our customer momentum. You can see it in our results. Salesforce has never been more essential to our customers. We're going to hear from them in just a second. And we're the number one Agentic CRM, transforming every company into an Agentic Enterprise. Now, let me tell you about these amazing Q1 numbers. Revenue was 11.13 billion, up 13% year-over-year nominal and 12% in constant currency. CRPO 33.6 billion, up approximately 14% nominal and 13% in constant currency. And Q1 non-GAAP operating margin of 34.8% up 250 basis points. Again, hitting some record levels. GAAP operating margin of 21.1% up 130 basis points. Pretty awesome. And we delivered 6.7 billion in operating cash flow. Tens of thousands of businesses across every industry are building their agentic enterprises with Salesforce. We're going to talk about that today. And OpenAI, Anthropic, Google - companies building the future of AI. All of them Salesforce customers, all of them Slack customers building these incredible new capabilities with Agent Force. We secured a record 98 Q1 deals with over $1 million in new ACV in the quarter. 98 Q1 deals with over a million dollars. Miguel is going to talk about that today. Organizations like LVMH, Chabanel, the US Air Force, which by the way just signed a new $72 million ELA with us during the quarter. Awesome. And we're seeing incredible demand for Agent Force with ARR now greater than a billion dollars. And combined with Data 360 and Informatica cloud, we've delivered 3.4 billion in AI and data ARR. 50% of Agent Force and Data 360 bookings were from existing customers expanding their commitment. And to date, we processed 28.6 trillion tokens up 152% quarter-over-quarter and converted them into 3.8 billion, as I mentioned already, Agentic Work Units for our customers up 111% quarter over quarter. Agent Force now powering every customer 360 application and it's changing how organizations operate across service, sales, marketing, commerce, and so much more. Nowhere is this more evident than in customer service. Let's just start right there with Agent for Service. Humans and agents collaborate across every channel from first contact to first resolution across the trinity of channels: voice, website, apps. A great example you're going to hear in a moment - UCLA Health. If you go to uclahealth.org, you'll see right away Agent Force is there to help you get your questions answered, to connect with their physicians, to connect with their technology at UCLA. It's a great example using our current most current version of Agent Force. And since we deployed Agent Force on help.salesforce.com and on 1-800-NO-SOFTWARE, well, only 15 months ago, it's autonomously handled now 4 million inquiries. It's now double what human agents are handling. Every customer can turn this on now. So many customers are seeing incredible results with Agent Force service. Vavino, the world's largest wine company, supporting 74 million users with only 37 reps. Kind of hard to believe, but it's possible because its agent Vavina autonomously handles order status lookups, account questions more autonomously, slashing resolution time by 70%. McAfee has selected our new Agent Force ITSM product or what we call Agent Force IT service to replace ServiceNow. They are using it for everything: ticket deflection, hardware provisioning, instant mana management. Really cool. And Florida Prepaid, a college savings plan provider with more than 200,000 accounts, is using Agent Force voice to autonomously handle 75% of business hour calls and 100% of after-hour calls. And with Agent Force sales, we're powering the entire revenue lifecycle from first lead to closed deal. And as I said before, over 25 years, Salesforce has generated tens of millions of leads we never called back. In Q1 alone, Agent Force sales worked 220,000 leads autonomously, generating $42 million in pipeline. Awesome. So, I'm more excited about what our customers are doing in service, in sales, in marketing, in Slack, and all of these things. Another great example: cybersecurity leader Fortinet using Agent for sales to power predictive lead scoring. Financial leader Agrabank now built an SDR agent that instantly qualifies leads on WhatsApp. You can go to salesforce.com and even see our own qualification system running right on our homepage as well. Okay. In Q1, we completed the acquisition of Qualified and integrated Piper, their SDR agent, into Salesforce. Brought all those great Salesforce alumni back home. More than 700 customers are already using Piper. It's an incredible success and we deployed Piper on Salesforce.com as I mentioned. So, you're going to be able to use it firsthand. I think that's so great. It's engaging 50% of our traffic and qualifying thousands of leads and delivering 45% more pipeline than traditional web agents. Also very excited about our new Agent Force Co-worker which we announced last week. If you haven't heard about that, every single one of our Salesforce applications now comes with a built-in autonomous agent. No complex configuration. You just turn it on. It becomes your co-worker finding answers, taking action, getting work done fast. To give you an idea of the impact that Co-worker will have, people search for information inside Salesforce 1 billion times a month. Co-worker turns search into answers and answers into action. And one of our trailblazers, Andrew Russo, you probably saw him respond directly to me on X, kind of was a surprise, but he said, 'There's no way this is real life right now. Agent Force Co-worker was able to pull together and navigate our complex sales and ERP data to answer questions that just yesterday would have been 60 minutes of swivel chairing between screens and systems.' It was pretty cool to see that. And I'll tell you this quarter we also announced Headless 360, again making all of Salesforce accessible through our MCP clients API CLA prompts. Headless 360 bringing together the humans, agents, and headless platforms so you can use Salesforce with any coding agent across any surface. It's going to speed implementations, drive consumption, more actions, more workflow, more data, more intelligence all compounding across Salesforce. We're meeting our customers where they are. Since launch in April, we've already processed four and a half million MCP calls into our platform. Q1 alone, we processed nearly a trillion API calls. Incredible. And with Headless 360, Indeed is building and deploying Agent Force agents right from Cursor. And Just Eat Takeaway, one of the leading online food delivery platforms in Europe. We just had them speak to our entire management team. It's such an amazing story. They are using Headless 360 already to bring agents into WhatsApp and other channels engaging with 350,000 partners across 15 countries. So now let's talk about our favorite Slack, which every AI company in the Bay Area here is using to run their business including OpenAI and Anthropic, transforming our customers into an Agentic Enterprise. Slack was nearly half of our million-plus wins this quarter up 80% year-over-year. It is a rocket ship to the moon. All of the AI companies run on Slack. As I mentioned, I don't think there's a startup or next-gen AI company that doesn't run on Slack. Anthropic calls Slack its core operating system. And that's what Slack is becoming for every enterprise. All of our apps are Slack-first. So now a service agent can summarize a case, update the record, escalate to a human right in Slack. And Slackbot is also an MCP client. So you can tell it to create a purchase order in NetSuite or update a project in Jira. And it happens. No switching tools. We've seen 1 million users of Slack MCP in the first six weeks. And Slack AWUs grew nearly 350% quarter over quarter. In two years, there'll be more agents using Slack than people. Every one of those agents needs the context and the data and the insights directly from Slack. Every workflow needs the data. Every action needs the integration. And every customer needs to see what's happening across the entire business. We have the largest collection of trusted CRM context ever assembled between Data 360, Informatica, Mulesoft, Tableau. Manage and deliver all that context so that any agent can reason, act and deliver real outcomes. Informatica is an amazing acquisition. It performed incredibly well this quarter. It's doing the heavy lifting in data management that every customer needs to move from pilot to production. All of this is why we're the number one Agentic CRM and we provide what every company needs to become an Agentic enterprise. Okay, so now let's keep going. With Slack and Headless 360, the entire platform is accessible. We have some new people joining us at the table. So that's very exciting. Great to see you buddy. And we're transforming and more importantly our customers are transforming too. Okay. All right. Anyway, here we are. Let's move on to what's really important. So, welcome. Thank you for being here.

James Ganka12:25

Thanks for having me.

Marc Benioff12:26

We're thrilled that you're here. And would you just introduce yourself to everybody because I don't think they know you.

James Ganka12:30

I'm James Ganka, president and CEO of PenFed Credit Union, headquartered in Tyson, Virginia.

Marc Benioff12:35

And is this your first time in San Francisco?

James Ganka12:37

Been here a few times meeting with Salesforce.

Marc Benioff12:40

Usually I see you in DC. So, so happy that you're here with us and grateful that you're here. So, why don't you tell us a little about, you know, you've been using Salesforce a while at PenFed. You've had this vision of becoming an Agentic Enterprise. Why don't you tell us, you know, what's happening? We heard you a little bit on your earnings call. I think everyone should hear you on our earnings call too.

James Ganka12:59

Let me just tell you the why. So, I started in financial services 25 years ago. There's 18,400 banks and credit unions. There's 8,000 today.

Marc Benioff13:10

Think about that.

James Ganka13:11

500 credit unions and banks are either merged or beaten out of existence every year.

Marc Benioff13:16

Amazing.

James Ganka13:17

And so, we knew we had to change. We've been around for 91 years and to remain relevant, we realized we needed to partner with somebody that can sort of rebuild our tech stack to take us to a new level.

Marc Benioff13:27

So, you were motivated.

James Ganka13:28

Super motivated. You got to be hungry every day. I was 6'5 like you when I started. I'm 5'6 today.

Marc Benioff13:35

All right. So, now tell us a little more about what have you done? What's the vision?

James Ganka13:39

About two years ago, I was actually at your world tour in New York City and I saw some other partners and their vision of what they thought it could do for the member experience. When we're competing against 8,000 other firms, we got to deliver hyperpersonalization in every transaction. We do about 500 transactions a second, 160 million member transactions a year. They have to be right anywhere in the world, real time. So we built our entire platform over the last few years. We went from about 400 platforms down to literally 12 strategic partners. Our call center, our mobile, our web, and our branches all run on Salesforce. Every additional partner or tech-siloed capability is an attack on innovation. It's an attack on speed and it's an attack on security. So by building it around Salesforce, I really think it's taken me 25 years to realize Jim Collins's flywheel effect. We have 76 agents now running across operations, mortgages, IT, HR. All of our areas are adopting it to make our employees more productive. We like to say they're bionic employees now. We're not losing employees. We're able to add more volume at scale, industrialized scale with the same number of people. We're very proud of that.

Marc Benioff14:56

Well, you know, you've heard the narrative on the SaaS apocalypse. You know, everybody's heard of this crazy thing that these AI apps are transforming software, which it definitely is true. You know, all of our products are just so much better because of it. But, you know, how is it impacting how you're using Salesforce?

James Ganka15:14

Let me talk about how people make a buying decision because I hear some of these stories. Somebody knocks on your door, are you going to open the door and give them the keys to your safe or the code to your safe to your family's jewels? Every day a CEO of any firm is going to get 50 cold calls. Somebody can do it different or better. How is a decision really made? First of all, does the firm in this case Salesforce have the product and service that we need? Second, do you have the engineers, the architects, the professionals to work with my team in order to bring that vision to reality? And then lastly, even if another firm had those first two, who is the firm standing behind it that can be there through good times and bad times, standing behind that product or service? When you line up all three, that's where a good trusted partnership exists. That's why we went with Salesforce. So we worked with your team literally hand in hand. We said we want to streamline processes. We want to take out latency in the code. We want to do X, Y, or Z. Your team was there in the trenches at every level. Engineers, architects building out the vision. But then it's not just pie in the sky on a white sheet of paper, it's implementable. We have 76 agents running side by side with our employees. A good example is in our call centers. We have an agent called Wingman. I'm an aviator so I think they named it because I like wingman. Agent Wingman is going to save me nearly $1.6 million this year. It will decrease our call handle time 10% this year. 50% reduction in after-call work times and 40% reduction in held calls. So better experience for the member. Remember they can go to 8,000 other institutions. I want them to have a great experience each and every time with PenFed. It's got to be right each and every time. Yet I want my employees to do the knowledge work building trust in the relationship, not entering what just happened on a phone call. We have agents that listen to the phone call, transcribe it, the human still in the loop. They approve what was just talked about, but then it's 360. If the transaction occurred in the branch, web, mobile, so the next person that deals with that consumer, that member, they know exactly the relationship. They know what we might want to sell them next or what they need next for their daughter, their graduation. So it's creating a hyperpersonalized omnichannel experience without having 400 people I need to meet with. I have 12 strategic partners that are allowing us to power the business.

Marc Benioff17:22

And you've kind of alluded to this, but obviously thank you for your service as well and just tell us about your members and how important they are to our country.

James Ganka17:29

We've been serving - we started out as the War Department Credit Union in 1935. We support the men and women who serve our nation across the national security community and all Americans who support them anywhere in the world. That's why it has to be right, correct, real time, industrial strength, and we're very proud of that.

Marc Benioff17:44

Well, we're very proud to have you as a Salesforce customer. Before we wrap it up today, is there anything that you think other financial service leaders like yourself or other folks who are thinking about implementing agent technology should know?

James Ganka17:56

It occurs faster than you think. So, literally, we had the vision where we saw what was possible two years ago. You can build it quickly. The most important thing is having the right partner and not to have too many partners. Too many partners slow things down.

Marc Benioff18:09

Fantastic, James. We couldn't be more thrilled to have you here today and it's great to have you in San Francisco and thanks for everything you're doing for the whole country and for everyone. Thank you so much. Great to be with you.

James Ganka18:18

Thank you.

Marc Benioff18:20

All right. Well, we're so happy to have James here. Thank you for coming to San Francisco. Unbelievable to have him here. It's so great and I think that's such a critical message. And then we have another customer with us as well, UCLA Health. Another great customer. They're using Agent Force to support 450 patients a day. I'm not going to go through all the details. Please welcome our good friends here, Palavi and also Michael. So guys, welcome and thanks for coming on the show here with us.

Michael18:48

Thanks, Mark.

Palavi18:49

Thanks for having us.

Marc Benioff18:50

Well, why don't you tell us your story? You just heard James' story. Why don't we hear your story down at UCLA Health? I already told everyone to go to uclahealth.org and look at Agent Force, but can you tell us a little about what you're doing?

Michael19:01

Sure. So we've been working with Salesforce for quite a few years, but most recently we've consolidated into one single instance of HealthCloud and we've built on top of that with Marketing Cloud, Data 360 and most recently launched our first experiment with Agent Force and that's a customer-facing chatbot that right now is only scraping our website to act as a little bit of a virtual concierge to direct patients to where they need to go. It's helping with find a provider, it's helping with general inquiries, it's helping with clinical trials. And the way I like to think about it is each of those topics may have been a phone call. They may have been an email. They may have been an onus put upon the patient, but now it's really a one-stop shop for the patient as opposed to, you know, them in a time of need. It's getting them their answers faster.

Marc Benioff20:02

Well, I'll tell you, it's so exciting to have you with us and, you know, there's so many healthcare institutions doing so much. I actually have a press release here about CVS Health is going to, you know, launch something tomorrow with us and I just want to say you guys are way ahead of everyone else. There's so many people with a lot of conservatism in the healthcare industry and deploying agents. What's your message to them in regards to, I already said you can go right to your website and see it, but what is your message to your peers or to others who are considering deploying Agentic technology?

Michael20:35

Um, I would say, you know, it took a while for us to sort of dip our toe in the water in the customer-facing space. We're doing a lot on the back end when it comes to research, but this really has an impact on our operations and we took a lot of precautions. This particular product really helped us from a testing perspective. There were a lot of protocols in place that allowed us to validate every step that we were taking and that offered a lot of certainty for senior leadership to kind of sign off on the first experiment that we took here.

Marc Benioff21:17

Outstanding. Palavi, give us the technical know-how, the detail here. You know, we're in the SaaS apocalypse as you know. So, you know, how do you look at the SaaS apocalypse? You're an expert in this area. You're deploying the technology. Give us your insight.

Palavi21:33

Yeah, absolutely. I think fundamentally we're looking at this technology with our business problem in mind: healthcare systems are stretched so thin. How do we help and support our healthcare workers and how do we help and support our patients get access to care faster? So for us, this is a technology, as is anything. How do we best utilize this technology to service and address those pain points operationally, make our staff faster, and help our patients? That's really what's driving us and really how we approach this. As Mike mentioned, we're using the same oversight, same policies and procedures that we need to deploy these types of technologies.

Marc Benioff22:08

Well, Palavi, you deployed our most current version of Agent Force. Incredible what you've done with it and the whole multimedia experience, the integration with the call center, every capability you're connecting your physicians, delivering the technical know-how of UCLA right to your clients. Just give us your biggest surprise deploying this technology. What was it that really hit you that was like, wow, this is what everybody should know?

Palavi22:41

I think with any technology implementation, the biggest thing that we take away is how much debt we've built up from a workflow standpoint. How much technical or people debt that we create and then we get mired in this. This is the way that things have to be. So this is really an opportunity for us to open the door and say there's a way we can do things differently. Can we solve the problems of yesterday and start to make a new enterprise for tomorrow? So that's really how we've been approaching it. We were excited that we were able to stand up our first agent use case that Mike led within eight months. So we're really looking forward to what's next and how can we scale and capitalize on this technology next.

Marc Benioff23:21

All right, Mike, there's the question. You know, what's next and how are you going to capitalize on this technology as a next step?

Michael23:27

That's actually the other great thing about this - there's been a lot of insights that our own patients have let us down and Agent Force has actually been great about sort of consolidating and chunking each of those. So whether it's what systems do we give Agent Force access to? What capabilities do we ask it to do for us? So next we're looking at potential integrations with MyChart. I think that's probably one that's relatively high on the list. But you know, we also want to start having some assistance with our back office functions as well. So there's a couple different things.

Marc Benioff24:10

Well, I want to just thank both of you for being on the call. We're so thrilled to have you. We're thrilled to have you as a customer, and I hope you'll not only continue to drive us forward, but also inspire our other customers as well. And with that, I'm going to turn over to Robin Washington.

Robin Washington24:24

Thanks a lot, Mark. Well, you've just heard the case for Salesforce as the number one Agentic CRM. The financials behind it tell the same story. So, let me start with the drivers behind the numbers, why our growth is durable, and how we're funding it with operational excellence. And I want to update you on our capital allocation strategy, which as Mark said is driving long-term shareholder value. One framing note before I walk you through the quarter. This is our first quarter under the new FY27 revenue disclosure framework. As agents transform how we build, sell, and serve customers, our new framework reflects that Agent Force is now deeply embedded across every one of our applications. So, please review our earnings deck for additional details on this. So starting with our durable growth drivers, Sales, Service and Slack are at the core of the number one Agentic CRM, collectively representing more than 60% of Q1 net new ACV. Agent Force ARR surpassed the billion dollar mark this quarter. Our largest applications, Sales and Service, saw year-over-year seat growth with humans and agents both expanding on the platform. Bookings for A1E and A4X, our premium SKUs anchored in Sales and Service, including the value from our Agentic capabilities, grew nearly 60% year-over-year. As customers adopt Agent Force, they expand across our platform. On average, our top 10 customers by Q1 AWU usage have increased their total Salesforce spend by 1.5x in the last year. And now with Informatica as part of Data 360, we're already unlocking synergies with revenue growth accelerating since the acquisition. This is the flywheel we laid out at our Investor Day and it's working. Those signals show up in the headline numbers. Q1 revenue came in at 11.13 billion, up 12% in constant currency, ahead of our guide. The outperformance was driven by Informatica's on-prem business and professional services timing. CRPO ended the quarter at 33.6 billion, up approximately 13% in constant currency, driven by continued momentum in Agent Force, Data 360, and Slack. Both metrics were partially offset by softness in Commerce and in Tableau. We're driving durable growth through operational excellence. We call our internal playbook Customer Zero. We're our own first customer, leveraging our products to run our business. It's how we're building a lean Agentic enterprise and driving profitable growth. And it is keeping us on track for our FY30 rule of 50 framework. In Q1, AI coding tools enabled us to double the amount of features and code shipped year-over-year while simultaneously reducing incidents and defects. Slackbot, which is embedded directly into the flow of work, is now our fastest-adopted AI tool in Salesforce's history, driving 3.8 million hours of annualized productivity gains for our employees. It has become a daily driver of my own productivity as well. And disciplined execution continues to underpin our responsible capital return strategy. Underscoring our confidence in the future, we commenced the largest ever 25 billion accelerated share repurchase or ASR, representing half of our 50 billion share repurchase authorization. Combined with our buyback program, this reduced Q1 diluted share count 10% year-over-year. Our ASR alone decreased Q1 share count by 103 million shares, representing 11% of shares outstanding. And it increased our Q1 non-GAAP earnings per share and GAAP earnings per share by 23 cents and 14 cents respectively. Turning to our outlook for the year, building on the momentum from the second half of last year, we expect first half net new ACV growth to outpace ACV growth and drive organic revenue reacceleration in the second half of FY27. Before discussing the numbers, a few key assumptions in our guide. Our Q2 and FY27 revenue guidance reflect continued momentum in Agent Force, Data 360, and Slack, partially offset by ongoing weakness in Marketing and Commerce and increased softness in Tableau bookings and renewals. We also expect greater license revenue volatility with the addition of Informatica on-prem revenue to our business. Now moving to the numbers, we are raising the midpoint of our FY27 revenue guidance to 45.9 billion to 46.2 billion, and we continue to expect subscription and support growth of approximately 11% year-over-year in constant currency. We are reiterating our non-GAAP operating margin guidance of 34.3% and adjusting our GAAP operating margin guidance to 20.6%, largely driven by higher restructuring. Our recent debt issuance tied to the successful initial delivery of our ASR resulted in an approximately five-point headwind to operating cash flow and free cash flow. As a result, we are updating our guidance for both metrics to grow 4 to 5% year-over-year. We expect Q2 revenue of 11.27 billion to 11.35 billion, growth of approximately 10% in constant currency. Q2 CRPO growth is expected to be approximately 13% year-over-year in constant currency. Our guidance reflects the strength of our balanced portfolio and reinforces our confidence in our second half revenue acceleration, enabling us to achieve our FY30 framework. And looking ahead, the Headless 360 strategy that Mark walked through expands our addressable market into surfaces we've never previously monetized. That's the next leg of our path to FY30. Back to you, Mike.

Mike Spencer31:39

Thank you, Robin. Operator, would like to move to questions now. I'll ask each participant to limit to one question in respect for others on the call. With that, operator, we'll take the first question.

Operator31:51

We will now begin Q&A. For today's session, we'll be utilizing the raise hand feature. If you'd like to ask a question, simply click on the raise hand button at the bottom of your screen. Once you've been called on, please unmute yourself and begin to ask your question. Please limit to one question. Thank you. We will now pause a moment to assemble the queue. Your first question will come from Brent Thill with Jefferies. Please go ahead.

Brent Thill32:16

Uh, good afternoon, Mark. I'm curious to get your thoughts on the transformation to an AI story. The Agent Force numbers are great to see, but what else in terms of what you're most excited about? What are you seeing in the signals from the customer pipeline in any other metrics that you're excited about that you can share with us that perhaps we can't see? Thank you.

Marc Benioff32:44

Well, that's why I thought it's so important that we move to this video concept for the earnings call and also that you get to hear directly from the customers. And I think we're trying to pick out a couple customers every quarter that can kind of, you know, I would say that they represent all of our customers in transformation. And I think that what's exciting is that the technology is really dramatically impacting how these customers are able to deliver their own results, which is why we even saw James bring this to his earnings call. So, I'm going to say that what we're going to do is we're going to continue to make that happen. Now, let me just give you my personal perspective. We're using it ourselves more than ever before. I kind of mentioned in the quarter, you see the service numbers - if you go to help.salesforce.com that we've delivered more than 4 million autonomous service transactions in a relatively short order, it's kind of hard to believe. Even if you go to 1-800-NO-SOFTWARE and you press 2 and you get into the service queue and you bypass our sales organization, you'll notice it's all autonomous. You even kind of authenticate autonomously. That Agent Force will work with you and then if at some point Agent Force kind of says it can't answer your question, it goes and then brings a human in directly to help work with it in resolving your problem. Also in the quarter, you saw like we qualified huge numbers of leads autonomously. We've just really never been able to do that before. I think every customer is going to be doing that. You saw we also bought Qualified and we have this kind of SDR sales agent going outbound as well, helping you to understand our own business. We're modeling this for all of our customers so that they can do this as well. Even in how I'm using Slack every day, I use Slackbot to give me insights into my business, to really look at everything that's happening with my core business. I can then get that insight. In every aspect of my business, agents are transforming how I operate my business, as you heard in UCLA Health or in PenFed. They are transforming their business from a technology perspective. The biggest thing that happened in the quarter from my perspective was that Agent Force is...

...

Now available and replaces essentially Salesforce search. So for those of you who are Salesforce users, the millions of people who use Salesforce every day, the search bar is a critical part of how the application operates. Now, Agent Force is that search bar. So you can not only search and aggregate and get insights into information throughout every single app we have, but also create agents and those agents can appear in Slack, in Microsoft Teams, in other applications, even in an app that's going to run directly on your phone called Salesforce Coworker. That is the biggest exciting technology because that is going to be technology that you're not going to have to implement. You're not going to have to rebuild things. All of a sudden, this agentic technology is directly enhancing every single one of our applications from our financial services cloud to our healthcare cloud to every app we have. So that's what's really exciting and I just think that the speed of innovation and the speed of change is what's awesome. And then the rate of innovation far exceeds the ability for customer adoption. That's why bringing these customers in to help model for other customers what they can do is really mission critical right now.

Operator36:13

With that, looks like we have Keith up for the next question. Keith.

Keith36:18

Excellent. Thank you guys for having me on the call and congratulations on all the momentum behind Agent Force and those AWUs accelerating in the quarter. I think the investor debate right now is about the timing and how that translates into strength for the broader business. The question I wanted to ask was where you guys garner your confidence of a back half organic subscription revenue acceleration because we haven't seen outperformance in CRPO for the last two quarters. This quarter was spot in line with your guidance. Last quarter was as well and it feels like the bookings trends are lagging a little bit. It feels like Tableau is dragging on the business a little bit, commerce cloud dragging on the business. So can you help us put those two sides of the debate like really strong KPIs from Agent Force but the bookings not really looking to come through over the past two quarters and how you sustain confidence in that back half acceleration.

Marc Benioff37:15

Yeah, Keith, maybe I'll start with the question and have Miguel and others chime in as well. So, you're right. Overall I would say Q1 and our Q2 guide show very strong CRPO. It is a leading indicator for us. But also keep in mind we raised our overall guidance for the year and the two metrics that we've talked about going all the way back to October is the acceleration of net new AOV greater than AOV. We saw that in the last half of FY26 and we also are seeing it and have huge confidence in it for the first half of 27. What that will lead to is a reacceleration of our core revenue growth in the second half of the year. And that's what I'd really ask you to kind of hone into. There's a lot of momentum that drives behind that. We've talked about our big deal motion. Miguel can talk about it more. Clearly we've seen the success with Agent Force and Data 360. I'd say that over 50% of those bookings came from existing customers refilling the tank. So we're definitely seeing good usage. Our pipeline is very strong. We've also seen an opportunity to expand our TAM. So I'll let Miguel maybe go into a little bit more details. But I think not only about CRPO, I think about our commitment and confidence relative to reacceleration growth is really the driver of how we see our bookings going forward.

Miguel38:44

Yeah, maybe thank you Robin. Maybe to add a few other metrics under the hood a little bit. We feel very comfortable. We obviously like the headline numbers but I also like in particular the strength of our core business. You alluded to the NUB acceleration. We're confident on the reacceleration of our subscription and support business in cost and currency the organically. But by the way in the H2 we also have another business we acquired which is Informatica. Informatica was a business that was growing single digit both on bookings and revenue. In just two quarters, we have significantly reaccelerated that bookings of the chart beyond anybody's expectation because data is king. Well, my daughters told me that data is queen because I have three daughters. But on the booking front, but on the revenue front, we've seen a huge acceleration. Now, we are in last quarter and this quarter, we are obviously subject to the timing of some of the on-prem renewals, but we are in double digit growth. So I like a lot of things about our core business which is very important. You alluded to big deals. We had 98 deals above a million dollars of NUV. In combination the top 10 deals focus on the top 10 deals. In combination the whole booking the annual incremental booking grew 60%. When you look at the TCV which goes in the RPO, we added approximately $800 million. That's two and a half times the same 10 deals last year. The top 10 deals, seven, this is a beautiful statistic, seven of the top 10 deals added seats, new seats.

Marc Benioff40:16

That's right.

Miguel40:17

This is the way the new way that we have to monetize AI. We have three new ways, three ways and then one more way that coming up as you alluded to. The first one is we are upgrading the existing seats of our customers so that the same users, human users, can use unlimitedly AI and this is the A1E that increased 60% in the quarter because there is a big uplift on those seats. Second, we are finding new pockets of seats that now with our transformed clouds, our clouds are not the same. We transform individually every one of our clouds. Our sales cloud, I've been using SalesCloud for 15 years, is totally different. Now we have Agent Force, I can talk to my SalesCloud. I don't want to say this because Parker already said it, I log into my SalesCloud less because I have access to so many ways to integrate my SalesCloud, Commerce Cloud, Marketing Cloud. Everything has been transformed, there is a big growth. So now the ROI of those clouds are higher, so there are pockets of users that before they couldn't afford buying us, now they're buying. Seven of the top 10 deals included... and then the biggest way that we have to monetize AI is with customer-facing use cases.

Marc Benioff41:28

Yes.

Miguel41:29

By selling flex credits, by putting fuel in the tank. Six of the top 10 deals were ISAS unlimited enterprise license agreement where we threw in a bunch of flex credits and customers are deploying use case after use case, channel after channel. They're going deterministic. They're going to voice. So I'm very confident on the reacceleration in H2. That's right. And we're very optimistic on the whole overall business.

Robin Washington41:54

And maybe the last thing I'd ask on CRPO, Keith, is remember it's also subject to renewal timing. And the more we get this flywheel growing and think about consumption, it's viewed as a leading indicator and how it's going to change relative to our revenue is something that's developing over time. So that's not necessarily...

Miguel42:14

It just comes shorter sales cycles. And by the way, the last huge thing, and you put it like a, and there is one more thing to come.

Marc Benioff42:22

There is one more thing to come which is the Headless 360. We're going to bring our agentic CRM to every surface, meeting customers where they are, and we're going to work together with our customers and with our partners to find the right ways in a fair way to monetize those new interactions and those new users accessing our platform.

Robin Washington42:42

So you've heard it straight from our CRO. We're very confident relative to reacceleration of our bookings as well as our revenue for the second half of FY27.

Operator42:53

Thank you, Keith. Gabrielle, welcome. We'll take your question now.

Gabrielle42:58

Good afternoon. Thanks so much. Miguel, you teed me up perfectly on headless here. Mark and team, I would love to spend a little bit of time on your headless strategy and more specifically how it intersects with the build versus buy debate. You know, on the one hand, Robin was talking about how it expands the opportunity and the surface area for Salesforce. On the other hand, talk to us about how you protect your downside from potentially enabling value abstraction out of Salesforce. Perhaps customers want to build things more in house or perhaps it enables competitors or value abstraction. So talk to us a little bit about your monetization strategy and how do you protect yourself to the downside? Thank you.

Marc Benioff43:37

Well, you're right. Headless is probably the most exciting announcement of the quarter and I'd love for Patrick to come in and Patrick is our Chief Marketing Officer. Patrick Stokes is here. Patrick, do you want to give us a little bit of an insight into our headless strategy?

Patrick Stokes43:52

Yeah, I'd love to. You know, we were just backstage prepping for this and we said what did we say about headless at the last earnings call and I realized we didn't, we were still getting ready to launch it at TDX,

Marc Benioff44:04

Right? Yeah, yeah. I mean, we hadn't even used the word yet and now it's become such a key part of our strategy and our customer strategy and how we're going to grow. You know, it was just at TDX in March when we launched this. And I think what's so exciting about headless is two things. One, it's having a real impact on making it easier to implement with Salesforce. So building out with Salesforce has now become easier than ever because we've seen these coding agents Claude and Codex from OpenAI. As you use these things, what you realize is you need to be able to connect the underlying APIs, which you do through this layer that's called MCP. And if you can connect those into the coding agents, it makes it faster than ever to implement and deploy Salesforce. And I think we're seeing that show up in the numbers. Just this quarter alone, Agent Force customers in production grew by 50%. So I think we're starting to see a little bit of that impact as not just our customers, but also our global SI across the entire platform. Absolutely implementing Data 360, implementing Agent Force, implementing Service, Life Sciences, all of this now becomes really just a conversation. So that's one end, but the other end is really what we heard from Miguel, which is this is really changing how people get value and consume Salesforce. In my experience, we're not seeing people take this capability and the coding agents, for example, and try to build all of this stuff themselves. What they want to do is they want to take this capability and they want to use Salesforce in different ways and get more value out of it. So rather than logging into this discrete application and this application and this application to get an answer to one question that might span multiple applications or multiple sources of information, you can now just take these MCP servers and plug them into any tool that you want. They are inside our application of course with Agent Force Co-worker as Mark described right up at that search bar. If you're a Slack customer you can get to it right with Slackbot that's really a headless experience as well but if you want to plug these into ChatGPT and Claude you can do that as well and all of this just results in more and more value being delivered to our customers from the Salesforce platform.

Srinivas Tallapragada46:14

Now I would just add to that. I think even though we just announced it, it's been less than a month.

Marc Benioff46:19

Correct.

Srinivas Tallapragada46:20

I think Salesforce historically has been very open and we got more than a trillion API calls on our core platform just in this quarter. What we have seen is on a headless MCP tool calls have been more than 1.5 million. So what people are using is they're using it not only in Salesforce where they do with Co-worker and our regular of sites they're also able to use it in their flow of work. Similarly, we announced the headless MCP server for Slack and Slack has done 30 million, 50 million tool calls. So what we are finding is there is a latent demand where people want to use Salesforce in their flow of work but they need a trusted infrastructure, they need an operational infrastructure to run it at scale with all the compliance, with all the sharing and security models, with all the permissioning, with all the compliance. So they will continue to use that while getting value and like as Miguel said, what we want to do is it's a new way, we want to capture value wherever the work is happening and that's the conversation we are having with our customers. And as we talk to our customers, ISV partners and all, we'll figure out the right value. So I think this is a new monetization area for us.

Marc Benioff47:36

Absolutely.

All right, well let's get down to one more level of detail. You know, this was the quarter where as we used the word headless for the first time, we used it in a we talked about it at Trailhead DX. I used it in a tweet, the tweet went really viral. It was a surprise to me, I'll be honest, because of course we had always been first on APIs and XML, in SOAP, in REST, and now in CLI and MCP. But the system was always built to be API first, it has always done massive amounts of transactions and complex transactions, we've always reported those API figures, and now we even have a new API which is our whole user interface basically spinning out of the platform as an API with... So we have that incredible capability. So in all cases, the platform has always been API first, all the applications have been API first, but when we announced headless, everybody's like, 'Oh, they've lobbed the top off of it or they've cut the applications off.' They kind of got confused in my opinion. They don't understand that all of our apps are rendered dynamically with metadata, that they're driven. It's a metadata driven platform. So Patrick, you're the marketing officer. Why did that confusion come from for people? Why do they think headless means that there's no more application or Salesforce app?

Patrick Stokes49:05

Well, probably from the name headless, which does seem to imply that. I can understand. But that term obviously if you're in the technology world, that comes from a it's been a term that's been used in technology for quite some time to imply that the UI is not directly linked to the underlying capabilities or services that are underneath it. In this case, APIs, and yeah, Salesforce has always been open. I think what people got so excited about here is this idea that Salesforce was endorsing this way of working. We were basically saying, 'Hey, we want you to take the value of Salesforce and the value that you get from our apps, from sales, from service, from commerce and marketing, and we want you to be able to work however you want to work, whether that's in Slack or whether that's in Claude or whether that's directly in the app.' That's what this capability really enables. And I think people were really excited about that. And maybe a little inappropriately skeptical that we would have just locked it all down and said, 'No, it has to be in our app.' And that's just never been the case for Salesforce. We've always been, I think year after year Postman says that Salesforce is the most used set of APIs on the planet. And if you're building today,

Marc Benioff50:12

People don't know what that means on this call. So will you just explain it? You got it down into the inside baseball.

Patrick Stokes50:20

Sure. So what that means is when you're a builder, when you're out there building something, and this is especially true today because there's now an ocean of builders that have been created as a result of this coding agent boom. When you go to build something for your business, you at some point are likely going to want to connect to Salesforce. That is what we see. And it doesn't matter what platform you're doing it on. You can be building something on a competitive platform to Salesforce or on Google or AWS or one of our partners, but at some point you're going to want to connect into Salesforce. And that's why those APIs have always been hugely used. But when you are building with an agent, you need a slightly different type of API. That's what we call MCP. And so by really putting those MCP servers out and saying, 'Yes, this is how we want people to build,' I think it was a big surprise and a big move in the right direction and it also creates a real monetizable opportunity for us.

Srinivas Tallapragada51:10

So if I could add one thing, because the fact that we announced headless at TDX made people think that this was just for builders and that now they can take our CRM apart, which they can now also by the way, but I think the big breakthrough was not with the builder workers but with the knowledge workers.

Marc Benioff51:30

It's more about how you work.

Miguel51:32

Let me give you two concrete examples. I met 100 customers basically face to face one-on-one since the beginning of the year. Two examples: Adecco, great customer across the board. They used pretty much every cloud. They went into Data Cloud and Agent Force last year. They did a big commitment in Q1 at the beginning of Q1. They are basically signing wall to wall. They have amazing recruiter agents going there, millions of transactions. They're moving into voice. When we announced headless, they called us and they are like, 'Wait a minute, let me try to understand what you're doing.' So now, because they are also using other platforms to develop other agents, so they have agents with some of the AI labs that they're also trying to access our data. 'Are you saying that now these agents that we are building outside Agent Force can also leverage Salesforce?' And we said exactly, we did it for that. So now there's going to be a lot of new agents that are going to be accessing our platform. That's example number one. Example number two is Anthropic. Anthropic, one of our biggest users of CRM, of SalesCloud, and obviously Slack. Their usage through Q1 has exploded fivefold because now they're using SalesCloud from a headless perspective and they are approaching it from Co-worker, from other applications, from Slack. They're hitting SalesCloud. So SalesCloud has become more prominent and more strategic for them than ever because of headless. These are two examples, extreme examples, but this is every single conversation that I have with a customer. Their smiles are big because of headless.

Robin Washington53:09

Oh, thank you, Gabriella. I hope you felt the energy on that question. Operator, we'll go to the next question, please.

Operator53:16

Your next question will come from Brad Zelnik with Deutsche Bank.

Brad Zelnik53:20

Great. Thanks so much for having me and nice to see everybody. Mark, the AWU and token consumption metrics are some of the biggest and fastest growing in software and seems to validate that customers are using and deriving value from the product. Can you help us translate the usage metrics to revenue? Like the Agent Force AR is impressive, but the usage suggests much faster adoption. And just as a related follow-up, the gross margins show no degradation despite surging token demand. So can you just help us understand how you're able to do that? Thanks.

Marc Benioff53:54

Yeah. Well, there's a lot of different points there. I'm not sure exactly where I want to go, but I mean, when we talk about the financial company when we talk about the Agentic Enterprise, first and foremost, obviously Salesforce is a large-scale company in software, the largest, 83,000 employees. For the last couple years, we have not been loading up a lot more engineers. Srini's here at the table. He's got what, about 15,000 engineers. And we've had the 15,000 engineers for about two years. It's been mostly flat, right? And I would say that the reason it's been mostly flat is because we have been using AI to create more efficiency for our engineers. And especially this year now with these new coding agents, we're seeing even more dramatic capabilities. So that's a key part of our margin story is that we're not hiring more engineers. We're not hiring more G&A. We're mostly expanding only in one area. You can see headcount has grown, but it's mostly growing in Miguel's area in sales because I think we all realize the one thing that we're doing here with you selling and communicating that agents are not exactly doing that. They can qualify, okay? They can provide service, but in sales, we still scale because there's so many different parts of the market that we have to get to. So that will be a critical part of expanding our company but at the same time expanding our margins. I think on the other part of that that's really key is you're right, we're trying to really communicate that level of token usage. Maybe we're one of the first to really get out and talk about, 'Hey, not only do we have agents but we've delivered 28.6 trillion tokens.' I listen to some of the other earnings calls and I don't think that they're at that level of detail. We've even gone down into this $3.8 billion Agentic Work Units where Patrick has really pioneered this idea of how to be able to communicate more effectively the level of depth that's really going on with our customers actually implementing this technology. And I think that is also a critical thing that we're only a couple years into this agentic revolution but we see all this adoption and usage in every other product that we've rolled out. You've never seen the level of scale and growth of a new product like we've seen with Agent Force. And you're going to see that in my opinion. I don't know, but I'm going to give you a vision. I think as we get Agent Force Co-worker live for all of our customers and it's just the ability for the administrator to say, 'Now that it's available to these users,' like that experience that we had with Andrew Russo, this idea that all of a sudden we're about to add a massive amount of new functionality and capability into all of our apps overnight, you're going to see these token numbers continue to expand and grow. Are we using more tokens internally? We are for our own operations like in engineering. Are we using them for our customers? We are. And then we're absorbing that into our margin structure. It's not that we're not spending a lot with OpenAI. We are, we're using their platform. We're using Codex, their coding tool. We're using Anthropic. We're using their platform and their coding tool, Co-worker. We're using both of these platforms. Both of these companies are our customers. We're very excited about how they're using it. We use their products as well. They use our products very aggressively, both of them, in Slack, and SalesCloud, in ServiceCloud, across the board. So that is really what's happening. Which part did I not directly address? I think you have it all.

Robin Washington57:36

Brad, maybe to add to your monetization point and you're right, AWU is something that we use to measure how work gets done with our customers and also internally as customer zero. But our top 10 AWU customers have spent more than 1.5x over this past year with us. So it is being monetized over time via consumption and just basically getting more value from our core. And I think we should probably just directly address this head on. And look, we're not going to give guidance on attrition and all these things. We never have. But Miguel, you're talking about how attrition's falling in the second quarter. And what's your vision around attrition and heads in in accounts and agents and what's happening in these customers?

Miguel58:17

I mean, our focus has been net new AOV. We did a lot of work to be honest with you to focus and align everyone in the organization from product to back office to front office to professional services. Everybody is aligned on one metric which is NUV which is the difference between the new bookings and then the leakage, the attrition. And we managed to redirect and we showed at the Investors Day how the curve was negative at some point, the negative growth.

Marc Benioff58:47

Q1 was a very strong net new AOV quarter for you as well. Right. So what does that tell us? Why is that transformation happening?

Miguel58:54

The important thing is we are focusing on customer success which has always been a focus but our some of the incentives were not aligned internally. They've been aligned now pretty much from the second half of the year we saw net new at pace in AUV growth. We are very confident that in H1 we're going to see continued NUB growth at pace in AUV growth. Obviously that's both levers. We are obviously increasing the new bookings and we are minimizing the pain of attrition. In some cases account executives they swap products to make sure that customers are happy using the product. So we are very confident on the NUV in H1 also being growing more than AUV and the reacceleration that we committed. And listen, when you commit something 12 to 18 months in advance, I mean we're good professionals but we're not magicians.

Robin Washington59:44

Yes. And we don't, I mean there was a probability that it could not have happened but we were very firm and I'm very happy that we're executing as per plan. In fact a little better than planned because you raised the guidance. So thank you so much. The only other thing I'd bring up to your point brought on margins again going back down into the depth of it is that as we march to FY30 and that rule of 50, our ability to leverage these tools to improve our productivity is a critical component of how we're going to get to rule of 50. As Miguel said, grow the top line $63 billion plus with Informatica but also improve margins and operating profitability. So as I said earlier, customer zero is number one for us and it's going to help us reach our framework as the lean agentic enterprise.

Operator1:00:35

Excellent. Okay, great. Let's move on to the next question.

Robin Washington1:00:37

Okay, with that operator, we'll take our last question now, please.

Operator1:00:41

Your last question will come from Kirk Matern with Evercore Partners.

Kirk Matern1:00:45

Well, thanks very much for squeezing me in. I want to follow up on Miguel. You had made a comment on one of your customers using SalesCloud through Slack and I want to dive in on Slack a little bit just as part of the broader headless strategy. Can you talk about Slack being potentially sort of a gateway for broader agentic adoption in your customer base, what you're seeing now, how that's sort of stacking up in your pipeline opportunities. It just seems like it's an unbelievable network effect product and I was curious how that's having an impact if at all right now or if you expect it to on sort of broader agentic bookings as we go into the back half of the year. Thanks.

Marc Benioff1:01:24

That's such a good question. I think each of these folks should address it, but Miguel, why don't you start?

Miguel1:01:29

So, first of all, from a topline perspective and we'll talk about how strategic Slack has become. Slack has become one of the favorite platforms and surfaces for, in this case, very specific both the builders and the knowledge workers found in Slack the way to, it's a multiplayer collaborative platform to access your applications, it's your work operating system. It's incredible what has happened on Slack, how we are leveraging, by the way, a great partnership with one of the AI labs, with Anthropic, to launch Slackbot. Slackbot is our personal assistant. It has increased the productivity of the whole company around 3% more or less. So now I do everything. I ask everything to an agent. That agent has access to all my applications, all my approvals, all my sharing models, all my conversations. And the business is booming. By the way, the bookings are booming, but also the NUV of that business is very impressive. And the key characteristic is, you know, when we talk about the MCP server tool calls on Slack, most of them were done by the builders building applications that needed that rich context that Slack provides. So huge growth, AOV topline growth, bookings growth, NUV, very little attrition. So also on Slack, I think it's the best place when we say agents and humans work together.

Srinivas Tallapragada1:02:54

You experience it in Slack. You know when you're in a channel and suddenly, in a lot of these especially I see it now in my engineering channels, like half the time somebody puts a question or a request on a Slack channel and the agent is listening and answering it. Developers do a PR request in Slack and then suddenly the agent is picking up and trying to do it. They want status reports. So I think Slack is where people can really understand the manifestation and they're all asking questions as a human and Slackbot is even a better way of articulating that in a packaged way. So that's what is driving the advanced use cases because the developer community tends to try these tools. It's very embedded. They see this manifestation a lot more and which is also the reason why some of our most advanced customers and labs and engineering organizations are using Slack MCP even more than we thought and I think that's a key interest. And I feel as it goes to the general population in the knowledge worker, Slack will become even more prominent because people will say this is the way to work. And we always said Slack is the operating system of work and I think now people can really see it and once they start using it, it looks like magic and that's why they say, 'Oh, this is how I always meant to be.'

Robin Washington1:04:20

Yeah Patrick, we're going to give you the last word here.

Patrick Stokes1:04:22

Great. Yeah, I mean I think it's all about the experience that Slack delivers. I mean when you get in and you use a product and it just works, that is a moment for you and you're going to go back to that product and I think that's exactly what Slack is and it's more sophisticated really than it's ever been. You know, we started as this collaboration tool, but it's become so much more than that. It's not just a place where all of your institutional knowledge is. It now can make calls out to other tools. You can have agents working right in there side by side with humans. You look at these coding projects and the incredible coding agents that have surfaced in the last two years. But the thing about coding is like that's not a single player job, right? When you code, you're working with a team. And Slack is the only place where you can have that coding agent and the full team of all of your engineers and your developers all working towards that... deals or support channels. It's there and with Slack CRM, this is all we brought back. So I think it's a natural place to work. So I really see that's what is driving.

Marc Benioff1:05:23

I think number one is this, which is that when we bought this company it was doing less than a billion in revenue and it was struggling. It was having problems. The management team was really not clear how they were competing against Microsoft. But I think coupling with our distribution capability now, adding the value of our core applications, and I think this key point that it drove nearly half of our million-dollar wins this quarter, up 80% year-over-year, that means that Slack is really having its absolute moment. And I think the second thing that's really important is here's these Slack AWUs that have grown 350% quarter over quarter. That is amazing. 350% quarter over quarter AWUs. In two years, there's going to be more agents using Slack than people. I mean, this is an incredible example of the future and also how this product is more valuable, being used more, has more data, more capability, and therefore it's going to have more intelligence and more value back to all of these customers as well. Plus, all of these companies can create Slack communication between each other as well. If you're a Slack customer, you can easily have a secure communication with another customer as well. Miguel, do you want to add...

Miguel1:06:33

Because that work graph that will become one of the richest work contexts in the enterprise is getting richer and richer. So, we built, I mean the community built 3 million custom apps on Slack in Q1. That's eight times quarter on quarter. I mean there is a huge boom. Out of those custom apps, there were 250,000 that were AI agents that were built, third party AI agents, and that grew more than double in quarter on quarter, grew eightfold year on year. So everybody is working on Slack.

Marc Benioff1:07:12

Well I think that it's safe to say and I'm not giving guidance by what I'm saying but Sales is a $10 billion cloud already, Service is a $10 billion cloud already, Data is already a $10 billion cloud. I think when we see the growth rate that's happening inside Slack, you saw the ACV was incredible in the first quarter, this is going to be fast-track from something we bought with less than a billion dollars that I'm sure we'll be talking in short order about Slack being a $10 billion cloud as well. All right, with that, I'm going to turn it back over to you, Michael.

Michael Spencer1:07:40

Yeah, thank you and thank you everyone for joining us on the call. Just a quick reminder, we have our quarterly webinar on Friday. And very timely given the questions today, we're going to talk about Slackbot and our headless strategy in a deeper way with our product leadership. So please join us for that on Friday. You can find the information on our website. And with that, we'd like to thank everyone for joining us and we'll be seeing everyone in the coming weeks.

Operator1:08:02

Thank you for joining. This concludes today's call and you may now disconnect.