Key Highlights
- Adjusted earnings per share reached $5.90, crushing Wall Street’s $3.27 forecast by 80%
- Quarterly revenue totaled $11.35 billion, marking 11% growth from the year-ago period and meeting projections
- Free cash flow skyrocketed 81% to reach $1.1 billion
- Shares rocketed 12.68% higher during extended trading, reaching $231.70
- Management elevated full-year revenue projections to a range of $46.1 billion to $46.4 billion
The enterprise software giant delivered fiscal second-quarter 2027 financial results Wednesday evening, showcasing performance that significantly exceeded market expectations. Shares climbed 12.68% to $231.70 in extended trading, building on the regular session’s closing price of $205.62.
The company’s adjusted earnings per share registered at $5.90, dramatically outperforming the analyst consensus of $3.27. The 80% upside surprise represents a remarkable achievement for an enterprise of this magnitude.
Quarterly revenue totaled $11.35 billion, reflecting an 11% increase from the prior-year period and aligning with the Street’s expectation of $11.33 billion. The figure marks a new quarterly revenue milestone for the cloud computing leader.
The company’s subscription and support segment, representing its primary revenue driver, advanced 12% to $10.82 billion. Current remaining performance obligations, a metric indicating future contracted revenue, totaled $33.5 billion, representing 14% growth in constant currency terms.
Free cash flow jumped 81% from the year-ago quarter to $1.1 billion. Operating cash flow increased 71% to $1.3 billion. The non-GAAP operating margin registered at 34.1%.
Artificial Intelligence Momentum Accelerates
Agentforce generated annual recurring revenue exceeding $1.5 billion, representing growth of more than 240% year over year. When combined with Data 360, total AI-focused ARR approached $3.9 billion, climbing more than 210%.
Salesforce processed 3.2 billion Agentic Work Units during the quarter, up 97% from the previous three-month period. Slackbot adoption surged more than 150% sequentially, while Slack achieved its most robust net-new annual order value expansion since being acquired.
Chief Executive Marc Benioff announced a new offering named Claudeforce, developed through collaboration with Anthropic. “This is the number one AI in the world, Anthropic, and the number one CRM, Salesforce, coming together for the first time,” he stated.
Forward-Looking Projections
Management increased its fiscal 2027 revenue outlook to $46.1 billion to $46.4 billion, representing a $300 million improvement from previous guidance.
Third-quarter revenue is projected between $11.42 billion and $11.5 billion, implying year-over-year expansion of 11% to 12%. Current remaining performance obligations growth for the third quarter is anticipated to remain near 14%.
The organization maintained its full-year non-GAAP operating margin forecast at approximately 34.3%. Annual operating and free cash flow growth is projected at roughly 4% to 5%.
Salesforce is implementing a $25 billion accelerated share buyback initiative, aiming to repurchase at least 14% of shares outstanding at an average cost of $176 per share.
Total remaining performance obligations stood at $66.3 billion, up 11% from the comparable year-ago period.
Analyst sentiment on CRM currently reflects a Moderate Buy rating, supported by 25 buy recommendations, nine hold ratings, and two sell ratings issued within the last three months. The consensus price target stands at $238.94.
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