What changed in this filing

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Item 2. Management’s Discussion and Analysis

2026-05-28 compared with 2025-12-04 · 147 added, 190 removed, 217 unchanged (61% of the section changed)

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Except as required by law, we undertake no obligation to revise or update publicly any forward-looking statements for any reason.

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.

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.

Agentforce includes a suite of customizable agents for use across sales, service, marketing and commerce.

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.

We continue to expand the capabilities of our autonomous AI agent layer integrated across our platform.

Agentforce enables organizations to deploy autonomous agents that reason, make decisions, and execute tasks.

Salesforce is the platform that powers how humans and agents work together, whether using Customer 360 apps, Slack, Headless 360, or other user interfaces.

We continue to invest for growth, including investing in generative and agentic AI across all products, which we believe will change how our customers help their customers, and continuously look to expand our leadership role in the cloud computing industry.

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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 these growth levers, our mergers and acquisitions framework has included several acquisitions that accelerate our agentic roadmap, including our October 2025 acquisition of Regrello Corp.

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

(“Informatica”).

These acquisitions are bringing in key talent and technology to accelerate innovation.

In addition to these growth levers, our mergers and acquisitions framework has included several acquisitions that have accelerated our agentic roadmap, including our April 2026 acquisition of Qualified.com, Inc.

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

(“Informatica”) and our October 2025 acquisition of Regrello Corp.

(“Regrello”).

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 included a reduction of our workforce and office space reductions within certain markets.

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 First Nine Months of Fiscal 2026

For the nine months ended October 31, 2025, revenue was $30.3 billion , an increase of nine percent year-over-year.

Highlights from First Quarter of Fiscal 2027

For the three months ended April 30, 2026, revenue was $11.1 billion , an increase of 13 percent year-over-year.

• Income from Operations:

For the nine months ended October 31, 2025, income from operations was $6.5 billion as compared to $5.4 billion from a year ago.

Operating margin, which represents income from operations as a percentage of total revenue, increased to approximately 22 percent for the nine months ended October 31, 2025 compared to approximately 19 percent in the prior year period.

For the three months ended April 30, 2026, income from operations was $2.3 billion as compared to $1.9 billion from a year ago.

Operating margin, which represents income from operations as a percentage

of total revenue, increased to approximately 21 percent for the three months ended April 30, 2026 compared to approximately 20 percent in the prior year period.

• Net Income per Share:

For the nine months ended October 31, 2025 , diluted net income per share was $5.73 as compared to diluted net income per share of $4.60 from a year ago.

Cash provided by operations for the nine months ended October 31, 2025 was $9.5 billion , an increase of four percent year-over-year.

Total cash, cash equivalents and marketable securities as of October 31, 2025 was $11.3 billion.

For the three months ended April 30, 2026 , diluted net income per share was $2.42 as compared to diluted net income per share of $1.59 from a year ago.

Our $25 billion Accelerated Share Repurchase (“ASR Agreements”) executed in March 2026 resulted in the repurchase of approximately 103 million shares in the period and benefitted our diluted net income per share by $0.14.

Cash provided by operations for the three months ended April 30, 2026 was $6.7 billion , an increase of three percent year-over-year.

Total cash, cash equivalents and marketable securities as of April 30, 2026 was $11.8 billion.

• Remaining Performance Obligation:

Total remaining performance obligation, which represents all future revenue under contract yet to be recognized, as of October 31, 2025 was approximately $59.5 billion, an increase of 12 percent year-over-year .

Current remaining performance obligation as of October 31, 2025 was approximately $29.4 billion , an increase of 11 percent year-over-year.

• Share Repurchase Program:

During the nine months ended October 31, 2025, we repurchased approximately 33 million shares of our common stock for approximately $8.7 billion.

Total remaining performance obligation, which represents all future revenue under contract yet to be recognized, as of April 30, 2026 was approximately $67.9 billion, an increase of 11 percent year-over-year .

Current remaining performance obligation as of April 30, 2026 was approximately $33.6 billion , an increase of 14 percent year-over-year.

• Dividend Program :

During the nine months ended October 31, 2025, we paid approximately $1.2 billion in dividends and dividend equivalents.

• Informatica Acquisition:

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

Over the first three quarters of fiscal 2026, we continued to see strong momentum in Data Cloud, Agentforce and our broader AI service offerings.

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

For the three months ended April 30, 2026, we paid approximately $365 million in dividends and dividend equivalents as compared to $402 million from a year ago.

Our diversified product portfolio and global customer base has provided us with operational resiliency across various geographies, products, and industry segments.

During the first quarter of fiscal 2027, we experienced sustained growth in Agentforce Apps and Data 360, bolstered by the acquisition of Informatica.

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 nine months ended October 31, 2025 were minimally impacted by foreign currency fluctuations compared to the nine months ended October 31, 2024.

Our current remaining performance obligation growth as of October 31, 2025 compared to October 31, 2024 was positively impacted by one percent compared to what would have been reported using constant currency rates.

Total revenues in the three months ended April 30, 2026 were positively impacted by approximately two percent in foreign currency fluctuations compared to the three months ended April 30, 2025.

Relative to April 30, 2025, our current remaining performance obligation growth as of April 30, 2026 was positively impacted by one 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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(1) subscription and support revenues and (2) professional services and other revenues.

Subscription and support revenues accounted for approximately 95 percent of our total revenues for the nine months ended October 31, 2025.

Subscription and support revenues accounted for approximately 95 percent of our total revenues for the three months ended April 30, 2026.

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.

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Changes in contract duration for multi-year term software licenses can impact the amount of revenues recognized upfront.

Revenues from term software licenses represent less than ten percent of total subscription and support revenue for the three and nine months ended October 31, 2025.

Revenues from term software licenses represent less than ten percent of total subscription and support revenue for the three months ended April 30, 2026.

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.

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

For example, customers may use our Sales, Service or Platform service offerings to record account and contact information, which are similar

features across these service offerings.

Depending on a customer’s actual and projected business requirements, more than one service offering may satisfy the customer’s current and future needs.

For example, customers may use our Sales, Service or Platform service offerings to record account and contact information, which are similar features across these service offerings.

Depending on a customer’s actual and projected business requirements, more than one

service offering may satisfy the customer’s current and future needs.

We record revenue based on the individual products ordered by a customer, not according to the customer’s business requirements and usage.

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

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

As of April 30, 2026, our attrition rate, excluding Slack self-service, Informatica, 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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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.

Cost of professional services and other revenues consists primarily of employee-related costs associated with these services, the cost of subcontractors, certain third-party fees and allocated overhead.

We believe that our professional services

organization facilitates the adoption of our service offerings, helps us to secure larger subscription revenue contracts and supports our customers’ success.

We believe that our professional services organization facilitates the adoption of our service offerings, helps us to secure larger subscription revenue contracts and

supports our customers’ success.

The cost of professional services may exceed revenues from professional services in future fiscal periods.

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Restructuring

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

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

Restructuring excludes allocated overhead.

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The following tables set forth selected data for each of the periods indicated (in millions):

3 Three Months Ended October 31, Nine Months Ended October 31,

2025 % of Total Revenues 2024 % of Total Revenues 2025 % of Total Revenues 2024 % of Total Revenues

1 Three Months Ended April 30,

2026 % of Total Revenues 2025 % of Total Revenues

Subscription and support $ 10,593 95 % $ 9,297 95 %

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Income from operations 2,347 21 1,942 20

Interest expense (317) (3) (68) 0

Gains (losses) on strategic investments, net 558 5 (63) (1)

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(1) Amounts related to amortization of intangible assets acquired through business combinations, as follows (in millions):

Three Months Ended October 31, Nine Months Ended October 31,

2025 % of Total Revenues 2024 % of Total Revenues 2025 % of Total Revenues 2024 % of Total Revenues

Three Months Ended April 30,

2026 % of Total Revenues 2025 % of Total Revenues

Cost of revenues $ 244 2 % $ 162 2 %

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(2) Amounts related to stock-based compensation expense, as follows (in millions):

Three Months Ended October 31, Nine Months Ended October 31,

2025 % of Total Revenues 2024 % of Total Revenues 2025 % of Total Revenues 2024 % of Total Revenues

Three Months Ended April 30,

2026 % of Total Revenues 2025 % of Total Revenues

Cost of revenues $ 138 1 % $ 151 1 %

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Restructuring 10 0 15 0

The following table sets forth selected balance sheet data and other metrics for each of the periods indicated (in millions, except remaining performance obligation, which is presented in billions):

October 31, 2025

The following table sets forth selected balance sheet data and other metrics for each of the periods indicated (in billions):

April 30, 2026

January 31, 2026

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Remaining performance obligation represents contracted revenue that has not yet been recognized, which includes unearned revenue and unbilled amounts that will be recognized as revenue in future periods.

Three Months Ended October 31, Variance

(in millions) 2025 2024 Dollars Percent

Subscription and support $ 9,726 $ 8,879 $ 847 10 %

Professional services and other 533 565 (32) (6)

Total revenues $ 10,259 $ 9,444 $ 815 9 %

Nine Months Ended October 31, Variance

Impact of Acquisitions

The comparability of our operating results in the three months ended April 30, 2026 compared to the same period in fiscal 2026 was impacted by our recent acquisitions, including the acquisition of Informatica in November 2025.

In our discussion of changes in our results of operations for the three months ended April 30, 2026, compared to the same period in fiscal 2026, we may quantitatively disclose the impact of our acquired products and services for the one-year period subsequent to the acquisition date to the growth in certain of our revenues where such discussions would be meaningful.

Expense contributions from our recent acquisitions for each of the respective period comparisons generally were not separately identifiable due to the integration of these businesses into our existing operations or were insignificant to our results of operations during the periods presented.

Three Months Ended April 30, Variance

(in millions) 2026 2025 Dollars Percent

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Total revenues $ 11,133 $ 9,829 $ 1,304 13 %

The increase in s ubscription and support revenues for the three and nine months ended October 31, 2025 was primarily caused by volume-driven increases from new business, which includes new customers, upgrades, and additional subscriptions from existing customers.

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

Revenues from term software licenses, which are recognized at a point in time, represented approximately four percent and six percent of total subscription and support revenues for the three and nine months ended October 31, 2025, and five percent of total subscription and support revenues for the three and nine months ended October 31, 2024.

Subscription and support revenues accounted for approximately 95 percent of our total revenues for the three and nine months ended October 31, 2025 and 94 percent for the three and nine months ended October 31, 2024.

The decrease in professional services and other revenues for the three and nine months ended October 31, 2025 was primarily due to less demand for larger, multi-year transformation engagements, which may continue in the near term.

The increase in subscription and support revenues for the three months ended April 30, 2026 was primarily caused by volume-driven increases from new business, which includes new customers, upgrades and additional subscriptions from existing customers.

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 of total subscription and support revenues for the three months ended April 30, 2026 and 2025.

Subscription and support revenues accounted for approximately 95 percent of our total revenues for the three months ended April 30, 2026 and 2025.

The increase in professional services and other revenues for the three months ended April 30, 2026 was primarily due incremental revenue from Informatica which was partially offset by less demand for larger, multi-year transformation engagements, which may continue in the near term.

The acquisition of Informatica in November 2025 contributed approximately $444 million of total revenues in the three months ended April 30, 2026.

Subscription and Support Revenues by Service Offering

Subscription and support revenues consisted of the following (in millions):

Three Months Ended October 31,

2025 As a % of Total Subscription and Support Revenues 2024 As a % of Total Subscription and Support Revenues Growth Rate

Agentforce Sales $ 2,297 24 % $ 2,119 24 % 8 %

Agentforce Service 2,495 26 2,288 26 9

Agentforce 360 Platform, Slack and Other 2,180 22 1,825 20 19

Agentforce Marketing and Agentforce Commerce 1,361 14 1,334 15 2

Agentforce Integration and Agentforce Analytics 1,393 14 1,313 15 6

Total $ 9,726 100 % $ 8,879 100 % 10 %

Nine Months Ended October 31,

Three Months Ended April 30,

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

Agentforce Sales $ 6,695 23 % $ 6,188 24 % 8 %

Agentforce Service 7,287 25 6,727 26 8

Agentforce 360 Platform, Slack and Other 6,227 22 5,329 20 17

Agentforce Marketing and Agentforce Commerce 4,051 14 3,924 15 3

Agentforce Integration and Agentforce Analytics 4,453 16 4,060 15 10

Agentforce Apps $ 6,910 65 % $ 6,345 68 % 9 %

Data 360, Headless Platform, and Other 3,683 35 2,952 32 25

Total $ 10,593 100 % $ 9,297 100 % 14 %

(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 coming from this change.

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.

Effective as of the first quarter of fiscal year 2027, we have revised the presentation of our disaggregated revenue disclosures to reflect the evolution of our product architecture to deliver the Agentic Enterprise.

Consistent with how management evaluates the performance of our business and how we develop, sell, serve, and engage customers, subscription and support revenue is now reported across two primary categories:

Agentforce Apps and Data 360, Headless Platform, and Other.

Agentforce Apps groups our applications with Agentforce, reflecting how Agentforce is embedded in every app, and is comprised of Agentforce Sales, Agentforce Service, Agentforce Marketing, Agentforce Commerce, Agentforce Apps Flex Credits and Slack.

Data 360, Headless Platform, and Other groups our data context layer and unified platform, to reflect the foundation powering Agentforce Apps, and is comprised of Data 360, Data 360 and Platform Flex Credits, Headless Platform, Informatica, Agentforce Mulesoft, Agentforce Tableau and Other.

Revenues by Geography

Three Months Ended October 31,

(in millions) 2025 As a % of Total Revenues 2024 As a % of Total Revenues Growth Rate

Americas $ 6,703 65 % $ 6,220 66 % 8 %

Europe 2,470 24 2,228 24 11

Asia Pacific 1,086 11 996 10 9

$ 10,259 100 % $ 9,444 100 % 9 %

Nine Months Ended October 31,

Three Months Ended April 30,

(in millions) 2026 As a % of Total Revenues 2025 As a % of Total Revenues Growth Rate

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Asia Pacific 1,146 10 1,023 10 12

$ 30,324 100 % $ 27,902 100 % 9 %

Total $ 11,133 100 % $ 9,829 100 % 13 %

Revenues by geography are determined based on the region of the Salesforce contracting entity, which may be different than the region of the customer.

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.

Total revenues were positively impacted by approximately one percent due to fluctuations in foreign currencies during the three months ended October 31, 2025 compared to the three months ended October 31, 2024, and were minimally impacted by foreign currency fluctuations during the nine months ended October 31, 2025 compared to the nine months ended October 31, 2024.

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

Cost of Revenues

Three Months Ended October 31, Variance

(in millions) 2025 As a % of Total Revenues 2024 As a % of Total Revenues Dollars

Subscription and support $ 1,665 16 % $ 1,501 16 % $ 164

Professional services and other 590 6 604 6 (14)

Total cost of revenues $ 2,255 22 % $ 2,105 22 % $ 150

Nine Months Ended October 31, Variance

(in millions) 2025 As a % of Total Revenues 2024 As a % of Total Revenues Dollars

Three Months Ended April 30, Variance

(in millions) 2026 As a % of Total Revenues 2025 As a % of Total Revenues

Subscription and support $ 1,953 18 % $ 1,611 16 % $ 342

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Total cost of revenues $ 2,570 23 % $ 2,265 23 % $ 305

Cost of revenues as a percentage of total revenues during the three months ended October 31, 2025 were consistent with the same period a year ago and decreased by approximately one percent during the nine months ended October 31, 2025 compared to the same period a year ago, primarily as a result of a decrease in amortization of intangible assets acquired through business combinations.

For the three and nine months ended October 31, 2025 , the increase in cost of revenues in absolute dollars was primarily due to an increase in service delivery expenses associated with our platform.

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 the three months ended April 30, 2026, the increase in cost of revenues in absolute dollars was primarily due to an increase in service delivery expenses and amortization of purchased intangibles, primarily associated with our acquisition of Informatica.

Total cost of revenues as a percentage of total revenues during the three months ended April 30, 2026 was consistent with the same period a year ago.

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

Three Months Ended October 31, Variance

(in millions) 2025 As a % of Total Revenues 2024 As a % of Total Revenues Dollars

Research and development $ 1,433 14 % $ 1,356 14 % $ 77

Sales and marketing 3,456 34 3,323 35 133

General and administrative 667 6 711 8 (44)

Restructuring 260 3 56 1 204

Total operating expenses $ 5,816 57 % $ 5,446 58 % $ 370

Nine Months Ended October 31, Variance

(in millions) 2025 As a % of Total Revenues 2024 As a % of Total Revenues Dollars

Three Months Ended April 30, Variance

(in millions) 2026 As a % of Total Revenues 2025 As a % of Total Revenues

Research and development $ 1,627 14 % $ 1,460 15 % $ 167

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Total operating expenses $ 6,216 56 % $ 5,622 57 % $ 594

Research and development expenses as a percentage of total revenues during the three months ended October 31, 2025 were consistent with the same period a year ago and decreased by approximately one percent during the nine months ended October 31, 2025 compared to the same period a year ago, primarily as a result of employee-related cost growth being outpaced by revenue growth.

For the three and nine months ended October 31, 2025, 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, primarily in lower cost regions.

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

Sales and marketing expenses as a percentage of total revenues during the three and nine months ended October 31, 2025 decreased by approximately one percent compared to the same periods a year ago, primarily as a result of employee-related cost growth being outpaced by revenue growth during the three months ended October 31, 2025 and a decrease in advertising and marketing events during the nine months ended October 31, 2025, respectively.

For the three and nine months ended October 31, 2025, the increase in sales and marketing expenses in absolute dollars was primarily due to an increase in employee-related costs.

For the three months ended April 30, 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 the three months ended April 30, 2026 decreased by one percent from the same period a year ago due to our total revenues growth outpacing our research and development expenses growth.

We expect research and development expenses will likely remain consistent as a percentage of revenue over time as we continue investing in new and existing technologies, including AI, agents, Data Cloud offerings, and the integration of Informatica.

Efficiencies realized from the rapid deployment of generative AI technologies will be reinvested to accelerate our product roadmap.

For the three months ended April 30, 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 our acquisition of Informatica.

Sales and marketing expenses as a percentage of total revenues during the three months ended April 30, 2026 decreased by one percent from the same period a year ago due to our total revenues growth outpacing our sales and marketing expenses growth.

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.

General and administrative expenses as a percentage of total revenues during the three months ended October 31, 2025 decreased by approximately two percent compared to the same period a year ago due to decreased employee-related costs and decreased bad debt expenses and during the nine months ended October 31, 2025 were consistent compared to the same period a year ago.

For the three months ended October 31, 2025, the decrease in general and administrative expenses in absolute dollars was primarily due to a decrease in bad debt expenses.

For the nine months ended October 31, 2025, the general and administrative expenses were relatively flat in absolute dollars compared to the same period a year ago.

We expect that general and administrative expens es 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 the three and nine months ended October 31, 2025, approximately $260 million and $300 million, respectively, of costs were incurred related to our restructuring initiatives, which were primarily related to employee transitions, severance payments and employee benefits.

Other Income and Expense

Three Months Ended October 31, Variance

(in millions) 2025 2024 Dollars

Gains (losses) on strategic investments, net $ 263 $ (217) $ 480

Other income 61 70 (9)

Nine Months Ended October 31, Variance

(in millions) 2025 2024 Dollars

For the three months ended April 30, 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.

General and administrative expenses as a percentage of total revenues during the three months ended April 30, 2026 was consistent with the same period a year ago.

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 the three months ended April 30, 2026, approximately $80 million of costs were incurred related to our restructuring initiatives, which was primarily related to employee transitions, severance payments and employee benefits.

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

Other Income and Expenses

Three Months Ended April 30, Variance

(in millions) 2026 2025

Interest expense (317) (68) (249)

Gains (losses) on strategic investments, net $ 558 $ (63) $ 621

Other income 133 163 (30)

Gains (losses) on strategic investments, net primarily reflect mark-to-market and observable price adjustments for equity securities, offset by impairments.

For the three months ended October 31, 2025, our strategic investment portfolio gains were primarily driven by unrealized gains on privately held equity investments of $428 million , partially offset by impairments on privately held investments of $169 million .

For the nine months ended October 31, 2025, our strategic investment portfolio gains were primarily driven by unrealized gains on privately held equity investments of $488 million and realized gains on sales of securities of $23 million, partially offset by impairments on privately held investments of $302 million.

Other income primarily consists of investment income, partially offset by interest expense on our debt and finance leases.

Interest expense was $67 million for the three months ended October 31, 2025 and 2024, respectively, and $202 million and $204 million for the nine months ended October 31, 2025 and 2024, respectively.

Provision For Income Taxes

Three Months Ended October 31, Variance

(in millions) 2025 2024 Dollars

Interest expense primarily relates to our debt as well as our finance leases.

Interest expense increased during the three months ended April 30, 2026, primarily due to incremental interest expense associated with our March 2026 debt offering.

We expect this debt offering to cause interest expense to increase as compared to prior year throughout fiscal 2027.

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 AI and volatility in public equity markets.

For the three months ended April 30, 2026, the net gain on our strategic investment portfolio was primarily driven by realized gains on privately held equity investments of $350 million and unrealized gains on privately held equity investments of $328 million, partially offset by impairments on privately held investments of $119 million.

The realized gains in the period were primarily comprised of a $268 million gain resulting from the exit of a privately held equity investment.

The unrealized gains in the period were primarily comprised of a $268 million mark-to-market gain from one privately held equity investment.

Other income primarily consists of interest income on our marketable securities portfolio.

Other income decreased during the three months ended April 30, 2026, primarily due to a decrease in investment income from lower interest rates.

Provision For Income Taxes

Effective tax rate 17 % 13 %

Nine Months Ended October 31, Variance

(in millions) 2025 2024 Dollars

Three Months Ended April 30, Variance

(in millions) 2026 2025

Provision for income taxes $ (614) $ (433) $ (181)

Effective tax rate 23 % 22 %

We recorded a tax provision of $426 million and $219 million for the three months ended October 31, 2025 and 2024, respectively, and a tax provision of approximately $1.4 billion and $961 million for the nine months ended October 31, 2025 and 2024, respectively.

Our effective tax rates increased from a year ago primarily due to lower excess tax benefits from stock-based compensation.

The 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, for example, acquisitions, changes to our operating structure, and other macroeconomic factors.

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.

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

The changes had an immaterial impact to the Company’s tax provision for the period ended October 31, 2025.

The Company may record additional impacts to its tax provision in the subsequent quarters as it continues to analyze the new law, other factors such as changes from its business operations, financial results and forecasts, and interrelated items including changes to our valuation allowance assessment related to Corporate Alternative Minimum Tax (“CAMT”).

We recorded a tax provision of $614 million on pretax income of $2.7 billion for the three months ended April 30, 2026.

Our effective tax rate increased from a year ago primarily due to 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.

Liquidity and Capital Resources

As of October 31, 2025, our principal sources of liquidity were cash, cash equivalents and marketable securities totaling $11.3 billion and accounts receivable of $5.5 billion.

As of April 30, 2026, our principal sources of liquidity were cash, cash equivalents and marketable securities totaling $11.8 billion and accounts receivable of $5.1 billion.

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

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agency obligations, asset-backed securities, foreign government obligations, mortgage-backed obligations, covered bonds, time deposits, money market mutual funds and municipal securities.

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 October 31, 2025, also serves as a source of liquidity.

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 April 30, 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 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.

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See discussion in “Debt” below.

We expect lower cash taxes primarily due to the immediate deduction of domestic research and development expenditures allowed by the OBBBA.

For the three and nine months ended October 31, 2025 and 2024, our cash flows were as follows (in millions):

3 Three Months Ended October 31, Nine Months Ended October 31,

2025 2024 2025 2024

For the three months ended April 30, 2026 and 2025, our cash flows were as follows (in millions):

1 Three Months Ended April 30,

Net cash provided by operating activities $ 6,701 $ 6,476

Net cash provided by (used in) investing activities 519 (217) 117 (227)

Net cash used in investing activities (2,183) (1,567)

Net cash used in financing activities (2,921) (2,920)

Operating Activities

The net cash provided by operating activities during the nine months ended October 31, 2025 was primarily comprised of net income of $5.5 billion, adjusted for non-cash items, including $2.5 billion of depreciation and amortization and $2.4 billion of stock-based compensation expense.

The net cash provided by operating activities during the three months ended April 30, 2026 was primarily comprised of net income of $2.1 billion, adjusted for non-cash items, including $985 million of depreciation and amortization and $857 million of stock-based compensation expense.

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 the nine months ended October 31, 2025 was further benefited by the changes in accounts receivable, net of $6.5 billion, partially offset by the change in unearned revenue of $5.7 billion and the change in accounts payable and accrued expenses and other liabilities of $1.2 billion.

Net cash provided by operating activities during the three months ended April 30, 2026 was further benefited by the change in accounts receivable, net of $9.4 billion partially offset by the changes in unearned revenue of $4.0 billion and accounts payable and accrued expenses and other liabilities of $1.9 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.

The net cash provided by operating activities during the nine months ended October 31, 2024 was primarily comprised of net income of $4.5 billion, adjusted for non-cash items, including $2.6 billion of depreciation and amortization and $2.4 billion of stock-based compensation expense.

Net cash provided by operating activities during the nine months ended October 31, 2024 was further benefited by the changes in accounts receivable, net of $6.7 billion partially offset by the change in unearned revenue of $5.6 billion and the change in accounts payable and accrued expenses and other liabilities of $503 million.

The net cash provided by operating activities during the three months ended April 30, 2025 was primarily comprised of net income of $1.5 billion, adjusted for non-cash items, including $843 million of depreciation and amortization and $814 million of stock-based compensation expense.

Net cash provided by operating activities during the three months ended April 30, 2025 was further benefited by the changes in accounts receivable, net of $7.6 billion, partially offset by the change in unearned revenue of $2.9 billion and the change in accounts payable and accrued expenses and other liabilities of $1.0 billion .

Investing Activities

The net cash provided by investing activities during the nine months ended October 31, 2025 was primarily related to net inflows from marketable securities activity of $2.9 billion, partially offset by net outflows from strategic investment activity of $1.3 billion and capital expenditures of $453 million.

The net cash used in investing activities during the nine months ended October 31, 2024 was primarily related to net outflows for acquisitions of $517 million, net outflows from strategic investment activity of $256 million and capital expenditures of $504 million, partially offset by net inflows from marketable securities activity of $1.1 billion.

The net cash used in investing activities during the three months ended April 30, 2026 was primarily related to net outflows for acquisitions of $1.5 billion, of which $1.1 billion related to the Qualified acquisition, as well as net outflows from marketable securities activity of $676 million and capital expenditures of $145 million, partially offset by net inflows from strategic investment activity of $90 million.

The net cash used in investing activities during the three months ended April 30, 2025 was primarily related to net outflows from marketable securities activity of $1.2 billion, net outflows from strategic investment activity of $143 million and capital expenditures of $179 million.

Financing Activities

The net cash used in financing activities during the nine months ended October 31, 2025 was primarily related to $8.7 billion used for repurchases of common stock and $1.2 billion related to payments of dividends, partially offset by $765 million of proceeds from equity plans.

The net cash used in financing activities during the nine months ended October 31, 2024 was primarily related to $7.8 billion used for repurchases of common stock, $1.0 billion related to repayments of debt and $1.2 billion related to payments of dividends, partially offset by $1.1 billion from proceeds from equity plans.

As of October 31, 2025, 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.

We were in compliance with all debt covenants as of October 31, 2025.

The net cash used in financing activities during the three months ended April 30, 2026 was primarily related to proceeds from the issuance of debt, net of issuance costs of $24.8 billion and proceeds from equity plans of $230 million partially offset by repurchases of common stock of $27.2 billion, which includes our March 2026 accelerated share repurchase, and payments of dividends and equivalents of $365 million.

The net cash used in financing activities during the three months ended April 30, 2025 was primarily related to $2.6 billion used for repurchases of common stock and $402 million related to payments of dividends, partially offset by $294 million of proceeds from equity plans.

As of April 30, 2026, we had senior unsecured debt outstanding, with maturities starting in March 2028 and extending through March 2066, with a total carrying value of $33.3 billion.

We were in compliance with all debt covenants as of April 30, 2026.

In October 2024, we entered into a credit agreement with the lenders and issuing lenders party thereto, and Bank of America, N.A., as administrative agent (the “Revolving Loan Credit Agreement”).

The Revolving Loan Credit Agreement replaced the Credit Agreement, dated December 23, 2020 (as amended, the “Prior Credit Agreement”), among us, the lenders and the issuing lenders party thereto, and Citibank, N.A., as administrative agent, which provided for a $3.0 billion unsecured revolving credit facility that was scheduled to mature on December 23, 2025.

There were no outstanding borrowings under the Prior Credit Agreement.

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 October 31, 2025.

In June 2025, we entered into a 364-Day Credit Agreement that provides 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.

The availability and funding of each credit agreement is subject to certain exceptions, qualifications and certain other conditions.

There were no outstanding borrowings under the Informatica Credit Agreements as of October 31, 2025.

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.

There were no outstanding borrowings under the Credit Facility as of April 30, 2026.

In March 2026, we entered into a $6.0 billion five-year senior unsecured term loan credit agreement (the “2026 Term Loan Credit Agreement”) with the lenders party thereto and JPMorgan Chase Bank, N.A., as administrative agent.

The 2026 Term Loan Credit Agreement matures in March 2031.

We used the full proceeds of the 2026 Term Loan Credit Agreement to

settle all of the outstanding borrowings under our $4.0 billion 364-day Credit Agreement and our $2.0 billion Three-year Credit Agreement, which were originally entered into in June 2025 to finance the acquisition of Informatica.

As of April 30, 2026, the full $6.0 billion was outstanding under the 2026 Term Loan Credit Agreement.

In March 2026, we also issued unsecured Senior Notes with an aggregate principal of $25.0 billion and maturities ranging from 2028 to 2066 (the “March 2026 Notes”).

We used the net proceeds from the March 2026 Notes to fund an accelerated share repurchase program, as discussed below.

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

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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.

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

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

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

In March 2026, we entered into the ASR Agreements with a syndicate of financial institutions to repurchase an aggregate of $25.0 billion of our common stock and received an initial delivery of approximately 103 million shares at an average price per share of $198.34, which represents approximately 80 percent of the total shares expected to be repurchased under the ASR Agreements.

The final settlement of repurchased shares is expected to occur in the second half of fiscal 2027.

Excluding the repurchases made under the ASR Agreements, we additionally repurchased the following shares of our common stock in the open market, (in millions, except average price per share):

Shares Average price per share Amount Shares Average price per share Amount

Three months ended April 30 11 $ 192.00 $ 2,145 10 $ 273.42 $ 2,681

Three months ended July 31 8 $ 269.96 $ 2,199 18 $ 246.14 $ 4,288

Three months ended October 31 15 $ 246.33 $ 3,814 5 $ 257.00 $ 1,228

All repurchases were made in open market transactions.

As of October 31, 2025, we were authorized to purchase a remaining $21.9 billion of the Company’s common stock under the Share Repurchase Program.

Subsequent to October 31, 2025, we have incurred approximately $1.2 billion through November 28, 2025 for additional shares repurchased under the Share Repurchase Program.

We announced the following dividends:

Quarter Ended Record Date Payment Date Dividend per Share Amount

As of April 30, 2026, we were authorized to purchase a remaining $22.9 billion of the Company’s common stock under the Share Repurchase Program.

Subsequent to April 30, 2026, we have not completed any additional share repurchases under the Share Repurchase Program.

The Company announced the following dividends:

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

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

Three months ended April 30, 2026 April 9, 2026 April 23, 2026 $ 0.440 $ 374

Three months ended April 30, 2025 April 10, 2025 April 24, 2025 $ 0.416 $ 406

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

As of October 31, 2025 , there were no significant changes to our estimates of future payments under our fixed contractual obligations and commitments as presented in “Management’s Discussion and Analysis of Financial Condition and Results of Operations” included in Item 7 of Part II of our Annual Report on Form 10-K for the fiscal year ended January 31, 2025 .

For more information regarding our lease obligations as of October 31, 2025 , see Note 5 “Leases and Other Commitments” to the condensed consolidated financial statements in Item 1 of Part I of this Quarterly Report on Form 10-Q.

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

During the nine months ended October 31, 2025 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.

As of April 30, 2026 , there were no significant changes to our estimates of future payments under our fixed contractual obligations and commitments as presented in “Management’s Discussion and Analysis of Financial Condition and Results of Operations” included in Item 7 of Part II of our Annual Report on Form 10-K for the fiscal year ended January 31, 2026 .

For more information regarding our lease obligations as of April 30, 2026 , see Note 5 “Leases and Other Commitments” to the condensed consolidated financial statements in Item 1 of Part I of this Quarterly Report on Form 10-Q.

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

During the three months ended April 30, 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 October 31, 2025, we expect approximately $160 million to $180 million in future cash payments related to our restructuring initiatives, primarily related to workforce costs, such as severance payments.

As of April 30, 2026, we expect approximately $130 million to $150 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 our balance sheet and cash provided by operating activities.

In November 2025, we acquired all outstanding stock of Informatica, an AI-powered enterprise cloud data management platform for approximately $9.6 billion, comprised primarily of $9.5 billion in cash.

The cash portion included proceeds from the Informatica Credit Agreements of $6.0 billion.

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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Compared sentence by sentence after normalising whitespace, quotation marks, case and digits, so re-formatting and restated figures do not read as changed language. Wording changes appear as one removal and one addition. The current filing and the prior one are authoritative.

What changed 10-Q

Item 2. Management’s Discussion and Analysis