What changed in this filing

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Item 2. Management’s Discussion and Analysis

2026-08-27 compared with 2026-05-28 · 146 added, 96 removed, 268 unchanged (47% of the section changed)

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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 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.

Highlights from First Six Months of Fiscal 2027

For the six months ended July 31, 2026, revenue was $22.5 billion, an increase of 12 percent year-over-year.

• Income from Operations:

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.

For the six months ended July 31, 2026, income from operations was $4.7 billion as compared to $4.3 billion for the six months ended July 31, 2025.

• Net Income per Share:

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.

For the six months ended July 31, 2026 , diluted net income per share was $6.67 as compared to diluted net income per share of $3.55 from a year ago.

Gains (losses) on strategic investments impacted our diluted net income per share by $2.87 and ($0.05) for the six months ended July 31, 2026 and 2025, respectively, based on a U.S.

tax rate of 23.5%.

Our $25 billion accelerated share repurchase program, which commenced in March 2026, resulted in the repurchase of approximately 103 million shares which benefited our diluted net income per share by $0.57 for the six months ended July 31, 2026.

Cash provided by operations for the six months ended July 31, 2026 was $8.0 billion, an increase of 10 percent year-over-year.

Total cash, cash equivalents and marketable securities as of July 31, 2026 was $11.4 billion.

• Remaining Performance Obligation:

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.

Total remaining performance obligation, which represents all future revenue under contract yet to be recognized, as of July 31, 2026 was approximately $66.3 billion, an increase of 11 percent year-over-year.

Current remaining performance obligation as of July 31, 2026 was approximately $33.5 billion, an increase of 14 percent year-over-year.

• Dividend Program :

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.

For the six months ended July 31, 2026, we paid approximately $729 million in dividends and dividend equivalents as compared to $801 million for the six months ended July 31, 2025.

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.

During the second quarter of fiscal 2027, we experienced strong momentum 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 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.

Total revenues in the six months ended July 31, 2026 were positively impacted by approximately one percent from foreign currency fluctuations compared to the six months ended July 31, 2025.

Relative to July 31, 2025, our current remaining performance obligation growth as of July 31, 2026 was minimally impacted 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 three months ended April 30, 2026.

Subscription and support revenues accounted for approximately 95 percent of our total revenues for the six months ended July 31, 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 months ended April 30, 2026.

Revenues from term software licenses represent less than ten percent of total subscription and support revenue for the three and six months ended July 31, 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 general, we exclude service offerings from acquisitions from our attrition calculation until they are fully integrated into our customer success organization.

As of April 30, 2026, our attrition rate, excluding Slack self-service, Informatica, and current year acquisitions, was approximately eight percent.

As of July 31, 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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Results of Operations

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

1 Three Months Ended April 30,

2026 % of Total Revenues 2025 % of Total Revenues

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

2 Three Months Ended July 31, Six Months Ended July 31,

2026 % of Total Revenues 2025 % of Total Revenues 2026 % of Total Revenues 2025 % of Total Revenues

Subscription and support $ 10,820 95 % $ 9,690 95 % $ 21,413 95 % $ 18,987 95 %

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

Three Months Ended April 30,

2026 % of Total Revenues 2025 % of Total Revenues

Three Months Ended July 31, Six Months Ended July 31,

2026 % of Total Revenues 2025 % of Total Revenues 2026 % of Total Revenues 2025 % of Total Revenues

Cost of revenues $ 234 2 % $ 150 2 % $ 478 2 % $ 312 2 %

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

Three Months Ended April 30,

2026 % of Total Revenues 2025 % of Total Revenues

Three Months Ended July 31, Six Months Ended July 31,

2026 % of Total Revenues 2025 % of Total Revenues 2026 % of Total Revenues 2025 % of Total Revenues

Cost of revenues $ 147 1 % $ 126 1 % $ 285 1 % $ 277 1 %

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

April 30, 2026

July 31, 2026

January 31, 2026

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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.

The comparability of our operating results in the three and six months ended July 31, 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 and six months ended July 31, 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

Three Months Ended July 31, Variance

(in millions) 2026 2025 Dollars Percent

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Total revenues $ 11,345 $ 10,236 $ 1,109 11 %

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.

Six Months Ended July 31, Variance

(in millions) 2026 2025 Dollars Percent

Subscription and support $ 21,413 $ 18,987 $ 2,426 13 %

Professional services and other 1,065 1,078 (13) (1)

Total revenues $ 22,478 $ 20,065 $ 2,413 12 %

The increase in s ubscription and support revenues for the three and six months ended July 31, 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 either period.

Revenues from term software licenses, which are recognized at a point in time, represented approximately four percent and five percent of total subscription and support revenues for the three and six months ended July 31, 2026, respectively, and six percent of total subscription and support revenues for the three and six months ended July 31, 2025.

Subscription and support revenues accounted for approximately 95 percent of our total revenues for the three and six months ended July 31, 2026 and 95 percent for the three and six months ended July 31, 2025.

The decrease in professional services and other revenues for the three and six months ended July 31, 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 $456 million and $900 million of total revenues for the three and six months ended July 31, 2026, respectively.

Subscription and Support Revenues by Service Offering

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

Three Months Ended April 30,

Three Months Ended July 31,

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

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Data 360, Headless Platform, and Other 3,618 33 3,008 31 20

Hedging gains 9 0 0 — N/A

Total $ 10,820 100 % $ 9,690 100 % 12 %

Six Months Ended July 31,

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

Agentforce Apps $ 14,102 66 % $ 13,027 69 % 8 %

Data 360, Headless Platform, and Other 7,299 34 5,960 31 22

Hedging gains 12 0 0 — N/A

Total $ 21,413 100 % $ 18,987 100 % 13 %

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.

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Revenues by Geography

Three Months Ended April 30,

Three Months Ended July 31,

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

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Asia Pacific 1,168 10 1,071 10 9

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

Hedging gains 9 0 0 — N/A

$ 11,345 100 % $ 10,236 100 % 11 %

Six Months Ended July 31,

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

Americas $ 14,637 65 % $ 13,205 66 % 11 %

Europe 5,518 25 4,766 24 16

Asia Pacific 2,311 10 2,094 10 10

Hedging gains 12 0 0 — N/A

$ 22,478 100 % $ 20,065 100 % 12 %

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.

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

Total revenues were minimally impacted due to fluctuations in foreign currencies during the three months ended July 31, 2026 compared to the three months ended July 31, 2025, and were positively impacted by one percent from foreign currency fluctuations during the six months ended July 31, 2026 compared to the six months ended July 31, 2025.

Cost of Revenues

Three Months Ended April 30, Variance

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

Three Months Ended July 31, Variance

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

Subscription and support $ 2,021 18 % $ 1,645 16 % $ 376

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Total cost of revenues $ 2,649 23 % $ 2,242 22 % $ 407

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.

Six Months Ended July 31, Variance

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

Subscription and support $ 3,974 18 % $ 3,256 16 % $ 718

Professional services and other 1,245 5 1,251 6 (6)

Total cost of revenues $ 5,219 23 % $ 4,507 22 % $ 712

Cost of revenues increased in absolute dollars, and by one percent as a percentage of total revenues, for the three and six months ended July 31, 2026 compared to the same period a year ago, primarily as a result of an increase in service delivery expenses, including spend on hosting services and generative AI technologies, as well as amortization of intangible assets acquired through business combinations.

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.

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Operating Expenses

Three Months Ended April 30, Variance

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

Three Months Ended July 31, Variance

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

Research and development $ 1,687 15 % $ 1,481 14 % $ 206

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Total operating expenses $ 6,365 56 % $ 5,662 55 % $ 703

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.

Six Months Ended July 31, Variance

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

Research and development $ 3,314 15 % $ 2,941 15 % $ 373

Sales and marketing 7,628 34 6,872 34 756

General and administrative 1,465 6 1,431 7 34

Restructuring 174 1 40 0 134

Total operating expenses $ 12,581 56 % $ 11,284 56 % $ 1,297

Research and development expenses as a percentage of total revenues during the three months ended July 31, 2026 increased by approximately one percent compared to the same period a year ago due to increased employee-related costs, as well as spend on hosting services and generative AI technologies.

Research and development expenses as a percentage of total revenues during the six months ended July 31, 2026 were consistent compared to the same period a year ago.

For the three and six months ended July 31, 2026, the increase in research and development expenses in absolute dollars was primarily attributable to these same cost drivers.

We expect that 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

We plan to reinvest savings from efficiencies realized from the rapid deployment of generative AI technologies to accelerate our product roadmap.

Sales and marketing expenses as a percentage of total revenues during the three and six months ended July 31, 2026 were consistent compared to the same periods a year ago.

For the three and six months ended July 31, 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 amortization of intangible assets acquired through business combinations .

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 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.

General and administrative expenses as a percentage of total revenues during the three and six months ended July 31, 2026 decreased by approximately one percent compared to the same periods a year ago due to revenue growth outpacing our general and administrative expenses growth.

For the three and six months ended July 31, 2026, general and administrative expenses were relatively flat in absolute dollars compared to 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.

In the three and six months ended July 31, 2026, we incurred approximately $94 million and $174 million, respectively, of costs related to our restructuring initiatives, which were 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

Other Income and Expense

Three Months Ended July 31, Variance

(in millions) 2026 2025 Dollars

Interest expense $ (473) $ (67) $ (406)

Gains on strategic investments, net 2,613 6 2,607

Other income 81 135 (54)

Six Months Ended July 31, Variance

(in millions) 2026 2025 Dollars

Interest expense $ (790) $ (135) $ (655)

Gains (losses) on strategic investments, net $ 3,171 $ (57) $ 3,228

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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.

Interest expense increased during the three and six months ended July 31, 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.

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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.

For the three months ended July 31, 2026, our strategic investment portfolio gains were primarily driven by unrealized gains on privately held equity investments of $2.9 billion, partially offset by impairments on privately held investments of $285 million.

For the six months ended July 31, 2026, our strategic investment portfolio gains were primarily driven by unrealized gains on privately held equity investments of $3.2 billion and realized gains on sales of securities of $354 million, partially offset by impairments on privately held investments of $404 million.

The unrealized gains for the three and six months ended July 31, 2026 include gains of $2.7 billion and $3.0 billion, respectively, related to the Company’s investment in Anthropic.

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

Other income decreased during the three and six months ended July 31, 2026 compared to the three and six months ended July 31, 2025, primarily due to a decrease in investment income from lower interest rates.

Provision For Income Taxes

Three Months Ended April 30, Variance

(in millions) 2026 2025

Three Months Ended July 31, Variance

(in millions) 2026 2025 Dollars

Provision for income taxes $ (1,026) $ (519) $ (507)

Effective tax rate 23 % 22 %

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.

Six Months Ended July 31, Variance

(in millions) 2026 2025 Dollars

Provision for income taxes $ (1,640) $ (952) $ (688)

Effective tax rate 23 % 22 %

We recorded a tax provision of $1.0 billion and $519 million for the three months ended July 31, 2026 and 2025, respectively, and a tax provision of approximately $1.6 billion and $952 million for the six months ended July 31, 2026 and 2025, respectively.

Our effective tax rates 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, 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 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.

As of July 31, 2026, our principal sources of liquidity were cash, cash equivalents and marketable securities totaling $11.4 billion and accounts receivable of $6.3 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 April 30, 2026, 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 July 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 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.

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

1 Three Months Ended April 30,

For the three and six months ended July 31, 2026 and 2025, our cash flows were as follows (in millions):

2 Three Months Ended July 31, Six Months Ended July 31,

2026 2025 2026 2025

Net cash provided by operating activities $ 1,269 $ 740 $ 7,970 $ 7,216

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

Net cash provided by (used in) investing activities (1,197) 1,165 (3,380) (402)

Net cash used in financing activities (622) (2,503) (3,543) (5,423)

Operating Activities

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.

The net cash provided by operating activities during the six months ended July 31, 2026 was primarily comprised of net income of $5.6 billion, adjusted for non-cash items, including $3.2 billion of gains on strategic investments, $2.0 billion of depreciation and amortization, and $1.8 billion 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 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.

Net cash provided by operating activities during the six months ended July 31, 2026 was further benefited by the change in accounts receivable, net of $8.0 billion, partially offset by the changes in unearned revenue of $5.6 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 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 .

The net cash provided by operating activities during the six months ended July 31, 2025 was primarily comprised of net income of $3.4 billion, adjusted for non-cash items, including $1.7 billion of depreciation and amortization and $1.6 billion of stock-based compensation expense.

Net cash provided by operating activities during the six months ended July 31, 2025 was further benefited by the changes in accounts receivable, net of $6.3 billion, partially offset by the change in unearned revenue of $4.2 billion and the change in accounts payable and accrued expenses and other liabilities of $1.2 billion .

Investing Activities

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.

The net cash used in investing activities during the six months ended July 31, 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 $871 million.

The net cash used in investing activities during the six months ended July 31, 2025 was primarily related to net outflows from strategic investment activity of $279 million and capital expenditures of $314 million, partially offset by net inflows from marketable securities activity of $245 million.

Financing Activities

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.

The net cash used in financing activities during the six months ended July 31, 2026 was primarily related to repurchases of common stock of $27.3 billion, which includes our March 2026 accelerated share repurchase, and payments of dividends and equivalents of $729 million, partially offset by proceeds from the issuance of debt, net of issuance costs of $24.8 billion.

The net cash used in financing activities during the six months ended July 31, 2025 was primarily related to $4.9 billion used for repurchases of common stock and $801 million related to payments of dividends, partially offset by $526 million of proceeds from equity plans.

As of July 31, 2026, we had senior unsecured notes 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 July 31, 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”).

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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 April 30, 2026.

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

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 July 31, 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”).

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

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):

In March 2026, we entered into accelerated share repurchase agreements (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 third quarter of fiscal 2027.

Excluding the repurchases made under the ASR Agreements in March 2026, 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

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.

Three months ended July 31 0 $ — $ 0 8 $ 269.96 $ 2,199

As of July 31, 2026, we were authorized to purchase a remaining $22.9 billion of the Company’s common stock under the Share Repurchase Program.

Subsequent to July 31, 2026, we have not completed any additional share repurchases under the Share Repurchase Program.

The Company announced the following dividends:

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

Three months ended July 31, 2026 June 11, 2026 July 2, 2026 $ 0.440 $ 373

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

Three months ended July 31, 2025 June 18, 2025 July 10, 2025 $ 0.416 $ 404

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 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.

As of July 31, 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 July 31, 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 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.

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Other Future Obligations

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.

In May 2026, the Company entered into an agreement to acquire Contentful Global, Inc.

(“Contentful”), provider of a leading composable content platform, for approximately $1.5 billion in cash, net of the value of shares currently owned by Salesforce, and subject to customary purchase price adjustments.

The acquisition is expected to close in the third quarter of the Company’s fiscal year 2027, subject to customary closing conditions, including the receipt of required regulatory approvals.

In June 2026, the Company entered into an agreement to acquire Intercom, Inc.

(“Fin”), a customer agent platform providing autonomous, end-to-end AI service agents, for approximately $3.6 billion in cash, and subject to customary purchase price adjustments.

The acquisition is expected to close in the third quarter of the Company’s fiscal year 2027, subject to customary closing conditions, including the receipt of required regulatory approvals.

As of July 31, 2026, we expect approximately $170 million to $190 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.

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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