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Item 7. Management’s Discussion and Analysis

2026-03-02 compared with 2025-03-05 · 121 added, 96 removed, 302 unchanged (42% of the section changed)

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Discussions of fiscal 2024 items and year-to-year comparisons between fiscal 2025 and 2024 that are not included in this Form 10-K can be found in “Management’s Discussion and Analysis of Financial Condition and Results of Operations” in Part II, Item 7 of our Annual Report on Form 10-K for the fiscal year ended January 31, 2025.

Salesforce is a global leader in customer relationship management (“CRM”) technology, enabling companies of every size and industry to connect with their customers through the power of data, artificial intelligence (“AI”), CRM and trust.

Founded in 1999, we bring humans together with AI agents to drive customer success on one deeply unified platform.

Salesforce is a global leader in customer relationship management (“CRM”) technology, helping organizations of any size become agentic enterprises.

Founded in 1999, we bring humans, agents, apps, and data together on a trusted, unified platform to unlock growth and innovation.

Our platform unites sales, service, marketing, commerce and IT teams by connecting customer data across systems, apps and devices to create a complete view of customers.

With this single source of customer truth and integrated AI, teams can be more responsive, productive and efficient, deliver intelligent, personalized experiences across every channel and increase productivity.

With this single source of customer truth and integrated artificial intelligence (“AI”), teams can be more responsive, productive and efficient, deliver intelligent, personalized experiences across every channel and increase productivity.

During the third quarter of fiscal 2025, we introduced Agentforce, a new layer of our trusted platform that enables companies to build and deploy AI agents that can respond to inputs, make decisions and take action autonomously across business functions.

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As a result, we have seen that customers with many of these characteristics drive higher annual revenues and have lower attrition rates than our company average.

In addition to our focus on top line growth levers, we are also focused on reducing our operating expenses to improve our operating margin.

For example, in January 2023, we announced a restructuring plan intended to reduce operating costs, improve operating margins and continue advancing our ongoing commitment to profitable growth which included a reduction of our workforce by approximately ten percent and office space reductions within certain markets.

The employee actions were substantially completed in fiscal 2024 and the real estate actions are expected to be fully complete in fiscal 2026.

In addition, we continued to evaluate and operationalize future programs to drive further operational efficiencies, optimize our management structure and increase cost optimization efforts to realize long-term sustainable growth, including targeted workforce and office space reductions that were initiated in fiscal 2025 and are expected to be substantially complete in fiscal 2026.

We have started to see improvements in our operating expenses across all operating categories, with the most opportunity in sales a nd marketing expense and general and administrative expenses.

Over the long term, we expect to see additional operating expense improvements, which could include various restructuring initiatives or measured hiring initiatives to drive operational efficiencies.

In addition to these growth levers, our mergers and acquisitions framework has included several acquisitions that have accelerated our agentic roadmap, including our October 2025 acquisition of Regrello Corp.

(“Regrello”) and our November 2025 acquisition of Informatica, Inc.

(“Informatica”).

These acquisitions bring in key talent and technology to accelerate innovation.

We are also focused on reducing our operating expenses to improve our operating margin.

We have undertaken various restructuring initiatives to improve operating margins and continue advancing our ongoing commitment to profitable growth, which has included a reduction of our workforce, office space and data centers within certain markets.

We continue to evaluate and operationalize future programs to drive further operational efficiencies, optimize our management structure and increase cost optimization efforts to realize long-term sustainable growth.

We expect to continue to experience improvements in our operating expenses as a percentage of revenue, which could include various restructuring initiatives or measured hiring initiatives to drive operational efficiencies.

Highlights from Fiscal 2026

For fiscal 2025, revenue was $37.9 billion , an increase of nine percent year-over-year.

For fiscal 2026, revenue was $41.5 billion , an increase of ten percent year-over-year.

• Income from Operations:

For fiscal 2026, income from operations was $8.3 billion as compared to $7.2 billion from a year ago.

Operating margin, which represents income from operations as a percentage of total revenue, increased to approximately 19 percent for fiscal 2025 compared to approximately 14 percent in the prior year.

Operating margin, which represents income from operations as a percentage of total revenue, increased to approximately 20 percent for fiscal 2026 compared to approximately 19 percent in the prior year period.

• Net Income per Share:

For fiscal 2026 , diluted net income per share was $7.80 as compared to diluted net income per share of $6.36 from a year ago.

Cash provided by operations for fiscal 2025 was $13.1 billion, an increase of 28 percent y ear-over-year.

Cash provided by operations for fiscal 2026 was $15.0 billion , an increase of 15 percent year-over-year.

Total cash, cash equivalents and marketable securities as of January 31, 2026 was $9.6 billion.

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Total remaining performance obligation, which represents all future revenue under contract yet to be recognized, as of January 31, 2026 was approximately $72.4 billion, an increase of 14 percent year-over-year .

Current remaining performance obligation as of January 31, 2025 was approximately $30.2 billion , an increase of nine percent year-over-year.

Current remaining performance obligation as of January 31, 2026 was approximately $35.1 billion , an increase of 16 percent year-over-year.

• Share Repurchase Program:

During the fiscal year ended January 31, 2025, we repurchased approximately 30 million shares of our common stock for approximately $7.8 billion.

For fiscal 2026, we repurchased approximately 50 million shares of our common stock for approximately $12.7 billion as compared to 30 million shares for approximately $7.8 billion from a year ago.

• Dividend Program :

During the fiscal year ended January 31, 2025, we paid approximately $1.5 billion in dividends.

In the second half of fiscal 2025, we continued seeing increasing momentum for Agentforce and other AI service offerings.

Outside of the demand for AI, the buying environment trends seen over the past two fiscal years have stabilized.

A reemergence of slower growth in new and renewal business could impact our remaining performance obligation, revenues and our ability to meet financial guidance and long-term targets.

For fiscal 2026, we paid approximately $1.6 billion in dividends and dividend equivalents as compared to $1.5 billion from a year ago.

• Informatica Acquisition:

In November 2025, we completed our acquisition of Informatica, an AI-powered enterprise cloud data management platform, for approximately $9.6 billion.

Informatica contributed approximately $0.4 billion of revenue in fiscal 2026.

During fiscal 2026, we experienced strong momentum in Agentforce, Slack and Data 360, bolstered by the acquisition of Informatica.

As we have a diversified portfolio of AI-enabled products and a customer base spanning geographies, segments, and industries, demand for our offerings has remained relatively resilient.

In addition, the expanding global scope of our business and the heightened volatility of global markets expose us to the risk of fluctuations in foreign currency markets.

Total revenues in the fiscal year ended January 31, 2025 were minimally impacted by foreign currency fluctuations compared to the fiscal year ended January 31, 2024.

Our current remaining performance obligatio n growth as of January 31, 2025 compared to January 31, 2024 was negatively impacted by two percent compared to what would have been reported using constant currency rates.

Total revenues in the fiscal year ended January 31, 2026 was positively impacted by approximately one percent in foreign currency fluctuations compared to the fiscal year ended January 31, 2025.

Our current remaining performance obligation growth as of January 31, 2026 compared to January 31, 2025 was positively impacted by three percent compared to what would have been reported using constant currency rates.

The impact of foreign currency fluctuations could impact our near-term results and ability to accurately predict our future results and earnings.

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Subscription and support revenues accounted for approximately 95 percent of our total revenues for fiscal 2026.

Subscription and support revenues include subscription fees from customers accessing our enterprise cloud computing services (collectively, “Cloud Services”), software license revenues from the sales of term software licenses, and support revenues from the sale of support and updates beyond the basic subscription fees or related to the sales of software licenses.

Subscription and support revenues primarily include subscription fees from customers accessing our enterprise cloud computing services (collectively, “Cloud Services”), software license revenues from the sales of term software licenses, and support revenues from the sale of support and updates beyond the basic subscription fees or related to the sales of software licenses.

Our Cloud Services allow customers to use our multi-tenant software without taking possession of the software.

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The revenue growth rates of each of our service offerings, as described below in “Results of Operations,” fluctuate from quarter to quarter and over time.

Additionally, we manage the total balanced product portfolio to deliver solutions to our customers and, as a result, the revenue result for each offering is not necessarily indicative of the results to be expected for any subsequent quarter.

subsequent quarter.

In addition, some of our Cloud Service offerings have similar features and functions.

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We calculate our attrition rate at a point in time on a trailing twelve-month basis as of the end of each month.

In general, we exclude service offerings from acquisitions from our attrition calculation until they are fully

integrated into our customer success organization.

As of January 31, 2025, our attrition rate, excluding Slack self-service, was approximately eight percent.

In general, we exclude service offerings from acquisitions from our attrition calculation until they are fully integrated into our customer success organization.

As of January 31, 2026, our attrition rate, excluding Slack self-service and current year acquisitions, was approximately eight percent.

We continue to maintain a variety of customer programs and initiatives, which, along with increasing enterprise adoption, have helped keep our attrition rate consistent as compared to the prior year.

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Accordingly, because of this billing activity, our first quarter is typically our largest collections and operating cash flow quarter.

Generally, our third quarter has historically been our smallest operating cash flow quarter .

Generally, our second or third quarter has historically been our smallest operating cash flow quarter .

Unearned revenues, accounts receivable and operating cash flow may also be impacted by acquisitions.

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Cost of subscription and support revenues primarily consists of expenses related to our employee-related costs, which includes salaries, benefits and stock-based compensation expense, delivering our service and providing support, including the costs of data center capacity, certain fees paid to various third parties for the use of their technology, services and data, and allocated overhead.

Our cost of subscription and support revenues also includes amortization of certain acquisition-related intangible assets, such as the amortization of the cost associated with an acquired company’s research and development efforts.

Also included in the cost of subscription and support revenues are expenses incurred supporting the free user base of Slack, including third-party hosting costs and employee-related costs specific to customer experience and technical operations.

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Restructuring

Restructuring consists of charges related to employee transition, severance payments, employee benefits and stock-based compensation as well as exit charges associated with office space reductions.

Restructuring consists of charges related to employee transition, severance payments, employee benefits and stock-based compensation, as well as data center exits, office space reductions and impairment charges associated with long-lived assets.

Restructuring excludes allocated overhead.

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We determine SSP by considering our overall pricing objectives and market conditions.

Significant pricing practices taken into consideration include our discounting practices, the size and volume of our transactions, the customer demographic, the geographic area where services are sold, price lists, our go-to-market strategy and historical and current sales and contract prices.

Significant pricing practices taken into consideration include our discounting practices, the size and

volume of our transactions, the customer demographic, the geographic area where services are sold, price lists, our go-to-market strategy and historical and current sales and contract prices.

In instances where we do not sell or price a product or service separately, we maximize the use of observable inputs by using information that may include market conditions.

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Business Combinations.

Accounting for business combinations requires us to make significant estimates and assumptions, especially at the acquisition date with respect to tangible and intangible assets acquired and liabilities assumed and pre-acquisition contingencies.

Accounting for business combinations requires us to make significant estimates and assumptions, especially at the acquisition date with respect to tangible and intangible assets acquired, as well as liabilities assumed and pre-acquisition contingencies.

We use our best estimates and assumptions to accurately assign fair value to the tangible and intangible assets acquired and liabilities assumed at the acquisition date as well as the useful lives of those acquired intangible assets.

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The carrying values of our privately held equity securities are adjusted if there are observable price changes in a same or similar security from the same issuer or if there are identified events or changes in circumstances that may indicate impairment, as discussed below.

In determining the estimated fair value for these investments, we utilize the most recent data available and apply valuation methods, including the market approach and option pricing models (“OPM”), adjusted to reflect the specific rights and preferences of the classes of securities we hold.

In determining the estimated fair value for these investments, we utilize the most recent data available and apply valuation methods, including the market approach, the common stock equivalent (“CSE”) method, and option pricing models (“OPM”), adjusted to reflect the specific rights and preferences of the classes of securities we hold.

Such information available to us from investee companies is supplemented with estimates such as volatility and expected time to liquidity.

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Depending on our contractual rights as an investor, investee specific information available to us to make this assessment may be limited or may be available on a delayed basis.

If the investment is considered to be impaired, we record the investment at fair value by recognizing an impairment through the consolidated statements of operations and establishing a new carrying value for the investment.

If the investment is considered to be impaired, we record the investment at fair

value by recognizing an impairment through the consolidated statements of operations and establishing a new carrying value for the investment.

Results of Operations

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Income from operations 8,331 20 7,205 19 5,011 14

Losses on strategic investments, net (121) 0 (277) (1) (239) (1)

Other income (expense) 354 1 216 1 (131) 0

Gains (losses) on strategic investments, net 1,017 3 (121) 0 (277) (1)

Other income 172 0 354 1 216 1

Income before provision for income taxes 9,520 23 7,438 20 4,950 14

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Pricing was not a significant driver of the increase in revenues for the period.

Revenues from term software licenses, which are recognized at a point in time, represented approximately six percent and seven percent of total subscription and support revenues for fiscal 2025 and 2024, respectively.

Revenues from term software licenses, which are recognized at a point in time, represented approximately six percent of total subscription and support revenues for fiscal 2026 and 2025.

Subscription and support revenues accounted for approximately 95 percent and 94 percent of our total revenues for fiscal 2026 and 2025, respectively.

The decrease in professional services and other revenues for fiscal 2025 was due primarily to less demand for larger, multi-year transformation engagements and, in some cases, delayed projects.

These trends may continue in the near term.

The decrease in professional services and other revenues for fiscal 2026 was primarily due to less demand for larger, multi-year transformation engagements, which may continue in the near term.

The acquisition of Informatica in November 2025 contributed approximately $399 million of revenue in fiscal 2026.

Subscription and Support Revenues by Service Offering (1)

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2026 As a % of Total Subscription and Support Revenues 2025 As a % of Total Subscription and Support Revenues Growth Rate

Sales $ 8,322 23 % $ 7,580 23 % 10 %

Service 9,054 25 8,245 25 10

Platform and Other 7,247 21 6,611 21 10

Marketing and Commerce 5,281 15 4,912 15 8

Integration and Analytics 5,775 16 5,189 16 11

Agentforce Sales $ 9,028 23 % $ 8,322 23 % 8 %

Agentforce Service 9,818 25 9,054 25 8

Agentforce 360 Platform, Slack and Other (2) 8,882 22 7,247 21 23

Agentforce Marketing and Agentforce Commerce 5,428 14 5,281 15 3

Agentforce Integration and Agentforce Analytics 6,232 16 5,775 16 8

Total $ 39,388 100 % $ 35,679 100 % 10 %

Our industry vertical service offerings revenue is included in one of the above service offerings depending on the primary service purchased.

Integration and Analytics subscription and support revenues include revenues from term software licenses, which are recognized at the point in time when the software is made available to the customer.

Therefore, we expect Integration and Analytics to experience greater volatility in revenues period to period compared to our other service offerings and recent revenue trends may not be indicative of future performance.

Additionally, as we transition customers within the Integration and Analytics offering from term software licenses to subscription based services, revenue associated with such customers will generally be recognized ratably over the contract term, which we expect may potentially result in less revenue in the period the customer transitions but incremental revenues over the remaining term.

(1) In the third quarter of fiscal 2026, we renamed our service offerings to reference Agentforce.

There were no changes in the allocation of revenue between these service offerings as a result of this change.

(2) Agentforce 360 Platform, Slack and Other revenue for the year ended January 31, 2026 includes $388 million in subscription and support revenue from Informatica, Inc.

(“Informatica”), which we acquired in November 2025.

Agentforce Integration and Agentforce Analytics subscription and support revenues include revenues from term software licenses, which are recognized at the point in time when the software is made available to the customer.

Therefore, we expect these offerings to experience greater volatility in revenues period to period compared to our other service offerings and recent revenue trends may not be indicative of future performance.

Additionally, as we transition customers within the Agentforce Integration and Agentforce Analytics offering from term software licenses to subscription based services, revenue associated with such customers will generally be recognized ratably over the contract term, which we expect may potentially result in less revenue in the period the customer transitions but incremental revenues over the remaining term.

Revenues by Geography

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The increase in revenues across all regions was primarily due to the continued execution of our business and growth strategy, including increasing our geographic reach primarily through extending our go-to-market capabilities globally.

Foreign currency did not contribute materially to the year over year fluctuations in revenue.

Foreign currency positively impacted the year over year fluctuations in revenue by approximately one percent.

Cost of Revenues

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Total cost of revenues $ 9,270 22 % $ 8,643 23 % $ 627

For fiscal 2025, the increase in cost of revenues in absolute dollars was primarily due to an increase in employee-related costs, including stock-based compensation expense, partially offset by a decrease in amortization of purchased intangibles and a decrease in service delivery expenses.

Our cost of revenues headcount increased by seven percent during fiscal 2025, primarily in lower cost regions.

Cost of revenues as a percentage of total revenues during fiscal 2025 decreased by two percent from the same period a year ago primarily due to our total revenues growth outpacing our cost of revenues growth.

We intend to continue to invest additional resources in enterprise cloud computing services to allow us to scale with our customers and continue to evolve our security measures.

The timing of these expenses, which also includes the use of AI and agents, may cause our cost of revenues as a percentage of revenues to fluctuate over time due to changes in demand for our service offerings.

For fiscal 2026, the increase in cost of revenues in absolute dollars was primarily due to an increase in employee-related costs, including stock-based compensation expense, and an increase to service delivery expenses partially offset by a decrease in amortization of purchased intangibles.

Cost of revenues as a percentage of total revenues during fiscal 2026 decreased by one percent from the same period a year ago due to our total revenues growth outpacing our cost of revenues growth, which was partially offset by the scaling of our service delivery expenses.

We intend to continue to invest additional resources in our AI, agentic and cloud services to allow us to scale with our customers and continue to evolve our security measures.

The timing of these expenses may cause our cost of revenues as a percentage of revenues to fluctuate over time due to changes in demand for our service offerings.

Operating Expenses

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For fiscal 2026, the increase in research and development expenses in absolute dollars was primarily due to an increase in employee-related costs, including stock-based compensation expense.

Research and development expenses as a percentage of total revenues during fiscal 2025 increased by one percent from the same period a year ago primarily due to an increase in relative employee-related costs, including stock-based compensation expense.

Our research and development headcount increased by 13 percent during fiscal 2025, primarily in lower cost regions.

We expect that research and development expenses will likely remain consistent as a percentage of revenue over time as we continue to invest in technology to support the development of new, and improve existing, technologies, including AI, agents and our Data Cloud service offerings, and the integration of acquired technologies.

For fiscal 2025, the increase in sales and marketing expenses in absolute dollars was primarily due to an increase in employee-related costs, including stock-based compensation expense.

Sales and marketing expenses as a percentage of total revenues during fiscal 2025 decreased by two percent from the same period a year ago due to a decrease in relative employee-related costs, including stock-based compensation expense and advertising expense.

Our sales and marketing headcount increased by one percent during fiscal 2025, primarily in lower cost regions.

Research and development expenses as a percentage of total revenues during fiscal 2026 was consistent with the same period a year ago.

We expect that research and development expenses will likely remain consistent as a percentage of revenue over time as we continue to invest in the development of new, and improve existing, technologies, including AI, agents and our Data 360 service offerings, and the integration of acquired technologies, including our November 2025 acquisition of Informatica.

For fiscal 2026, the increase in sales and marketing expenses in absolute dollars was primarily due to an increase in employee-related costs, including stock-based compensation expense, and increased amortization of purchased intangibles primarily associated with the Informatica acquisition.

Sales and marketing expenses as a percentage of total revenues during fiscal 2026 was consistent with the same period a year ago.

We expect that sales and marketing expenses may decrease as a percentage of revenues over time as we continue to focus on leveraging our self-serve and partner-led channels and increasing our sales productivity, which includes the use of AI and agents.

For fiscal 2025, the increase in general and administrative expenses in absolute dollars was primarily due to an increase in employee-related costs, including stock-based compensation expense, and professional services expenses.

For fiscal 2026, the increase in general and administrative expenses in absolute dollars was primarily due to an increase in employee-related costs, including stock-based compensation expense, and professional services expenses, which were partially offset by a decrease in bad debt expenses.

General and administrative expenses as a percentage of total revenues during fiscal 2026 was consistent with the same period a year ago.

Our general and administrative headcount increased by three percent during fiscal 2025.

We expect that general and administrative expenses may decrease as a percentage of revenues over time as we continue to invest in process efficiency initiatives, which includes the use of AI and agents.

In fiscal 2025, approximately $461 million of costs were incurred related to our restructuring initiatives, which was primarily related to employee transitions, severance payments and employee benefits.

In fiscal 2026, approximately $586 million of costs were incurred related to our restructuring initiatives, which was primarily related to employee transitions, severance payments and employee benefits, as well as select data center exits.

We do not expect to incur significant additional charges in connection with our restructuring initiatives in the near term.

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(in millions) 2026 2025

Losses on strategic investments, net $ (121) $ (277) $ 156

Gains (losses) on strategic investments, net $ 1,017 $ (121) $ 1,138

Other income 172 354 (182)

Losses on strategic investments, net consists primarily of mark-to-market adjustments related to our publicly held equity securities, observable price adjustments related to our privately held equity securities and other adjustments including impairments.

Our strategic investment portfolio continues to be affected by challenging market conditions for companies in which we hold private equity, debt or other investments, as well as high public equity market volatility.

In fiscal 2025 these factors resulted in impairments on privately-held equity and debt securities of $582 million, partially offset by $358 million in unrealized gains on privately held equity securities.

Gains (losses) on strategic investments, net consists primarily of mark-to-market adjustments related to observable price adjustments related to our privately held equity securities, our publicly held equity securities and other adjustments including impairments.

Our strategic investment portfolio continues to be affected by market conditions for companies in which we hold private securities, including the pace of technological change driven by artificial intelligence and volatility in public equity markets.

For fiscal 2026, the gain on our strategic investment portfolio was primarily driven by unrealized gains on privately held equity investments of $1.5 billion partially offset by impairments on privately held investments of $496 million.

Our mark-to-market unrealized gains in fiscal 2026 were driven largely by $1.2 billion in gains from one privately held equity investment.

Other income primarily consists of interest income on our marketable securities portfolio, which is partially offset by interest expense on our debt as well as our finance leases.

Other income increased in fiscal 2025 primarily due to an increase in investment income from higher interest rates.

Other income decreased in fiscal 2026 primarily due to a decrease in investment income from lower interest rates.

We expect that interest expense may increase due to the outstanding balance related to the Informatica Credit Agreements.

Provision For Income Taxes

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We recorded a tax provision of $2.1 billion on pretax income of $9.5 billion for fiscal 2026.

Our tax provision increased from a year ago primarily due to higher pretax income.

Our effective tax rate increased from a year ago primarily due to lower tax benefits from foreign-derived intangible income deduction and stock-based compensation.

Our effective tax rate may fluctuate due to changes in our domestic and foreign earnings, or material discrete tax items, or a combination of these factors resulting from transactions or events, including acquisitions, changes to our operating structure and other macroeconomic factors.

Several countries have enacted legislation to implement the Organization for Economic Cooperation and Development’s 15% global minimum tax regime effective January 1, 2024.

There was no material impact to our income tax provision for fiscal 2025.

We continue to evaluate the impacts of legislation in the jurisdictions in which we operate.

Our effective tax rate and cash tax payment could increase in future years.

On July 4, 2025, the One Big Beautiful Bill Act (“OBBBA”) was enacted into law.

The OBBBA includes significant

changes to US corporate tax provisions of the Tax Cuts and Jobs Act.

Notably, it allows an immediate deduction for domestic

research and development expenditures, reinstates 100% bonus depreciation, and modifies the international tax framework.

legislation has multiple effective dates, with certain provisions effective in fiscal 2026 and others in the subsequent years.

changes had an immaterial impact to the Company’s tax provision in fiscal 2026.

Fiscal Year Ended January 31, 2025 and 2024

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Liquidity and Capital Resources

At January 31, 2025, our principal sources of liquidity were cash, cash equivalents and marketable securities totaling $14.0 billion and accounts receivable of $11.9 billion.

As of January 31, 2026, our principal sources of liquidity were cash, cash equivalents and marketable securities totaling $9.6 billion and accounts receivable of $14.3 billion.

Our cash equivalents and marketable securities are comprised primarily of corporate notes and obligations, U.S.

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Our Revolving Loan Credit Agreement (as defined below), which provides the ability to borrow up to $5.0 billion in unsecured financing (the “Credit Facility”) as of January 31, 2026, also serves as a source of liquidity.

Net cash provided by operating activities could continue to be affected by various risks and uncertainties, including, but not limited to, the risks detailed in Part I, Item 1A, “Risk Factors.” We believe our existing cash, cash equivalents, marketable securities, cash provided by operating activities, unbilled amounts related to contracted noncancellable subscription agreements, which are not reflected on the balance sheet, and, if necessary, our borrowing capacity under our Credit Facility will be sufficient to meet our working capital, capital expenditure and debt maintenance needs over the next 12 months and thereafter.

Net cash provided by operating activities could continue to be affected by various risks and uncertainties, including, but not limited to, the risks detailed in Part II, Item 1A, “Risk Factors.” We believe our existing cash, cash equivalents, marketable securities, cash provided by operating activities, unbilled amounts related to contracted noncancellable subscription agreements, which are not reflected on the balance sheet, and, if necessary, our borrowing capacity under our Credit Facility will be sufficient to meet our working capital, capital expenditure and debt maintenance needs over the next 12 months and thereafter.

In the future, we may enter into arrangements to acquire or invest in complementary businesses, services, technologies and intellectual property rights.

To facilitate these acquisitions or investments, we may seek additional equity or debt financing, which may not be available on terms favorable to us or at all, impacting our ability to complete subsequent acquisitions or investments.

For fiscal 2025, 2024, and 2023 our cash flows were as follows (in millions):

For example, we entered into certain credit agreements in connection with our acquisition of Informatica.

See discussion in “Debt” below.

Our cash tax profile was impacted by OBBBA primarily due to the immediate deduction of the domestic research and development expenditures.

Moreover, the OBBBA brought into scope other provisions of the U.S.

Guidance that clarifies these provisions could change our future cash taxes.

For fiscal years ended January 31, 2026, 2025, and 2024 our cash flows were as follows (in millions):

4 Fiscal Year Ended January 31,

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Net cash provided by operating activities can be significantly impacted by factors such as growth in new business, timing of cash receipts from customers, vendor payment terms and timing of payments to vendors.

Net cash provided by operating activities during fiscal 2025 was further benefited by the changes in unearned revenue of $1.6 billion and accounts payable and accrued expenses and other liabilities of $1.1 billion, partially offset by the changes in costs capitalized to obtain revenue contracts, net of $2.1 billion, prepaid expenses and other current assets and other assets of $1.5 billion and accounts receivable, net of $490 million.

Net cash provided by operating activities during fiscal 2026 was further benefited by the changes in accounts payable and accrued expenses and other liabilities of $1.0 billion and unearned revenue of $2.9 billion, partially offset by the change in accounts receivable, net of $2.2 billion and costs capitalized to obtain revenue contracts, net of $2.8 billion.

As our business continues to grow, and assuming our expenses remain in line with or less than our revenue growth, we expect to continue to see growth in net cash provided by operating activities.

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Net cash provided by operating activities during fiscal 2024 was further benefited by the change in unearned revenue of $1.6 billion, partially offset by the changes in accounts receivable, net of $659 million and the change in accounts payable and accrued expenses and other liabilities of $478 million.

Investing Activities

The net cash used in investing activities during fiscal 2026 was primarily related to net outflows for acquisitions of $9.3 billion, which is primarily associated with $8.1 billion, net, related to the Informatica acquisition, as well as net outflows from strategic investment activity of $1.8 billion and capital expenditures of $594 million, partially offset by net inflows from marketable securities activity of $3.0 billion.

The net cash used in investing activities during fiscal 2025 was primarily related to net outflows for acquisitions of $2.7 billion, net outflows from strategic investment activity of $413 million and capital expenditures of $658 million, partially offset by net inflows from marketable securities activity of $642 million.

The net cash used in investing activities during fiscal 2024 was primarily related to capital expenditures of $736 million, net outflows from strategic investment activity of $388 million, and net outflows related to marketable securities activity of $121 million.

Financing Activities

The net cash used in financing activities during fiscal 2025 was primarily related to $7.8 billion used for repurchases of common stock, $1.5 billion related to payments of dividends and $1.0 billion related to repayments of debt, partially offset by $1.5 billion from proceeds from equity plans.

Net cash used in financing activities during fiscal 2024 was primarily related to $7.6 billion from repurchases of common stock and $1.2 billion related to repayments of debt, partially offset by $2.0 billion from proceeds from equity plans.

The net cash used in financing activities during fiscal 2026 was primarily related to $12.6 billion used for repurchases of common stock and $1.6 billion related to payments of dividends and equivalents, partially offset by $6.0 billion of proceeds from the Informatica credit agreements and $1.0 billion of proceeds from equity plans.

As of January 31, 2026, we had senior unsecured debt outstanding, with maturities starting in April 2028 and extending through July 2061 with a total carrying value of $8.4 billion.

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There were no outstanding borrowings under the Prior Credit Agreement.

The Revolving Loan Credit Agreement provides for a $5.0 billion unsecured revolving credit facility (“Credit Facility”) and matures in October 2029.

The Revolving Loan Credit Agreement provides for a $5.0 billion Credit Facility and matures in

October 2029.

We may use the proceeds of future borrowings under the Credit Facility for general corporate purposes.

There were no outstanding borrowings under the Credit Facility as of January 31, 2026.

In June 2025, we entered into a 364-day Credit Agreement that provided us with the ability to borrow up to $4.0 billion (the “364-day Informatica Credit Agreement”) and a three-year Credit Agreement that provides us with the ability to borrow up to $2.0 billion (the “Three-year Informatica Credit Agreement” and, together with the 364-day Informatica Credit Agreement, the “Informatica Credit Agreements”), both on an unsecured basis, to finance a portion of the cash consideration for the acquisition of Informatica, the repayment of certain debt of Informatica and the payment of fees, costs and expenses related thereto.

In November 2025, as part of the acquisition of Informatica, we borrowed the full $6.0 billion available under the credit facilities associated with the Informatica Credit Agreements, which was outstanding as of January 31, 2026.

We do not have any special purpose entities and we do not engage in off-balance sheet financing arrangements.

Share Repurchase Program

In August 2022, the Board authorized a program to repurchase up to $10.0 billion of our common stock (the “Share Repurchase Program”).

Our Board of Directors (the “Board”) authorized a program to repurchase shares of the Company's common stock (the "Share Repurchase Program"), which commenced in August 2022.

In September 2025, the Board authorized an additional $20.0 billion in repurchases under the Share Repurchase Program, for an aggregate total authorized of $50.0 billion.

The Share Repurchase Program does not have a fixed expiration date and does not obligate us to acquire any specific number of shares.

In February 2023, the Board authorized an additional $10.0 billion in repurchases under the Share Repurchase Program.

In February 2024, the Board authorized an additional $10.0 billion in repurchases under the Share Repurchase Program for an aggregate total authorization of $30.0 billion.

We repurchased the following under the Share Repurchase Program (in millions, except average price per share):

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As of January 31, 2026, we were authorized to purchase a remaining $17.9 billion of the Company’s common stock under the Share Repurchase Program.

Subsequent to January 31, 2025, we have incurred approximately $535 million through February 28, 2025 for additional shares under the Share Repurchase Program.

We announced the following dividends (in millions, except dividend per share):

Record Date Payment Date Dividend per Share Amount

March 14, 2024 April 11, 2024 $ 0.40 $ 388

July 9, 2024 July 25, 2024 $ 0.40 $ 388

September 18, 2024 October 8, 2024 $ 0.40 $ 385

December 18, 2024 January 9, 2025 $ 0.40 $ 388

The declaration and payment of future cash dividends is subject to our Board continuing to determine that the declaration of dividends is in the best interests of the Company and our stockholders, after giving consideration to continued capital availability, general economic and market conditions, and applicable laws and agreements.

Subsequent to January 31, 2026, we have incurred approximately $1.4 billion through February 25, 2026 for additional shares repurchased under the Share Repurchase Program.

In February 2026, the Board authorized $50.0 billion in share repurchases under the Share Repurchase Program that replaced the previous remaining unpurchased authorization.

We announced the following dividends:

Quarter Ended Record Date Payment Date Dividend per Share Amount

(in millions)

April 30, 2025 April 10, 2025 April 24, 2025 $ 0.416 $ 406

July 31, 2025 June 18, 2025 July 10, 2025 $ 0.416 $ 404

October 31, 2025 September 17, 2025 October 9, 2025 $ 0.416 $ 400

January 31, 2026 December 18, 2025 January 8, 2026 $ 0.416 $ 395

April 30, 2024 March 14, 2024 April 11, 2024 $ 0.40 $ 388

July 31, 2024 July 9, 2024 July 25, 2024 $ 0.40 $ 388

October 31, 2024 September 18, 2024 October 8, 2024 $ 0.40 $ 385

January 31, 2025 December 18, 2024 January 9, 2025 $ 0.40 $ 388

In February 2026, the Board declared a $0.44 dividend per share that is payable on April 23, 2026 to stockholders of record as of the close of business on April 9, 2026.

The declaration and payment of future cash dividends is subject to the Board continuing to determine that the declaration of dividends is in the best interests of the Company and our stockholders, after giving consideration to continued capital availability, general economic and market conditions, and applicable laws and agreements.

Contractual Obligations

Our principal commitments consist of obligations under leases for office space, co-location data center facilities and our development and test data center, as well as leases for computer equipment, software, furniture and fixtures.

As of January 31, 2025, the future noncancellable minimum payments under these commitments were approximately $4.0 billion, with payments of $1.0 billion due in the next 12 months and $3.0 billion due thereafter.

As of January 31,

2026, the future noncancellable minimum payments under these commitments were approximately $3.6 billion, with payments of $0.9 billion due in the next 12 months and $2.7 billion due thereafter.

In addition to our leasing arrangements, we have other contractual commitments associated with agreements that are enforceable and legally binding, including those with infrastructure service providers.

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We generally expect to satisfy these commitments with cash on hand and cash provided by operating activities.

During fiscal 2025 and in future years, we have made, and expect to continue to make, additional investments in our infrastructure to scale our operations to increase productivity and enhance our security measures.

During fiscal 2026 and in future years, we have made, and expect to continue to make, additional investments in enterprise cloud computing services to allow us to scale with our customers and continue to evolve our security measures.

We plan to upgrade or replace various internal systems to scale with our overall growth.

While we continue to make investments in our infrastructure and with infrastructure service providers to provide capacity for the growth of our business, our strategy may continue to change related to these investments and we may slow the pace of our investments.

While we continue to make investments in our infrastructure service providers to provide capacity for the growth of our business, our strategy may continue to change related to these investments and we may slow the pace of our investments.

Other Future Obligations

As of January 31, 2026, we expect approximately $220 million to $250 million in future cash payments related to our restructuring initiatives, primarily related to workforce costs, such as severance payments.

We generally expect to satisfy these commitments with cash on hand and cash provided by operating activities.

We generally expect to satisfy these commitments with cash on our balance sheet and cash provided by operating activities.

Stakeholder Impact

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Transparency is key to trust, which is why we have published an annual Stakeholder Impact Report for over ten years to keep our stakeholders informed and to hold ourselves accountable to our sustainability, impact and equality strategies.

Our disclosures in these areas are also informed by topics identified through relevancy assessments and third-party ESG reporting organizations, frameworks and standards, such as the Sustainability Accounting Standards Board (“SASB”) Standards.

Our disclosures in these areas are also informed by topics identified through relevancy assessments and third-party ESG reporting organizations, frameworks and standards.

Read more about these initiatives and view our Stakeholder Impact Report at https://salesforce.com/stakeholder-impact-report.

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What changed 10-K

Item 7. Management’s Discussion and Analysis