CRM - Salesforce Inc. (CRM) Q1 2025 Earnings Call Transcript

2024-05-29 20:33:10 ET

Salesforce, Inc. (CRM)

Q1 2025 Results Conference Call

May 29, 2024 05:00 PM ET

Company Participants

Mike Spencer - EVP, Finance and Strategy, IR

Marc Benioff - Chair and CEO

Amy Weaver - President and CFO

Brian Millham - President and COO

Conference Call Participants

Keith Weiss - Morgan Stanley

Brad Sills - Bank of America

Brent Thill - Jefferies

Kirk Materne - Evercore ISI

Karl Keirstead - UBS

Raimo Lenschow - Barclays

Kash Rangan - Goldman Sachs

Mark Murphy - JPMorgan

Presentation

Operator

Welcome to Salesforce's Fiscal 2025 First Quarter Results Conference Call. All lines have been placed on mute to prevent any background noise. After the speakers' remarks, there will be a question-and-answer session [Operator Instructions]. I would now like to hand the conference over to your speaker, Mike Spencer, Executive Vice President of Finance and Strategy and Investor Relations. Sir, you may begin.

Mike Spencer

Thanks, and good afternoon. Thanks for joining us today on our fiscal 2025 first quarter results conference call. Our press release, SEC filings and a replay of today's call could be found on our Web site. Joining me on the call today is Marc Benioff, Chair and CEO; Amy Weaver, President and Chief Financial Officer; and Brian Millham, President and Chief Operating Officer. As a reminder, our commentary today will include non-GAAP measures, reconciliations of our GAAP and non-GAAP results and guidance can be found in our earnings materials and press release. Some of our comments today may contain forward-looking statements that are subject to risks, uncertainties and assumptions, which could change. Should any of these risks materialize or should our assumptions prove to be incorrect, actual company results could differ materially from these forward-looking statements. A description of these risks, uncertainties and assumptions and other factors that could affect our financial results is included in our SEC filings, including our most recent report on Forms 10-K, 10-Q and any other SEC filings. Except as required by law, we do not undertake any responsibility to update these forward-looking statements. And with that, let me hand the call over to Marc.

Marc Benioff

Thanks so much, Mike. I'm really excited for the call today, because there's two things that I'm really been looking forward to talking about. First is our incredible financial transformation as you can see from the numbers today and the second is the incredible work that's happening with artificial intelligence. Look, first of all, in Q1, we delivered $9.13 billion in revenue, up 11% year-over-year in both nominal and constant currency. Subscription and support revenue grew at 12% year-over-year and 13% in constant currency. And for the 11th year in a row, Salesforce is still ranked the number one provider worldwide by market share based on the latest IDC software tracker. I mean, that really gets to a core part of our technology transformation that I'm going to get to, which is the transformation to AI. And because we are the number one CRM provider, we're now managing more than 250 petabytes of data for our customers. This is going to be absolutely critical as they move into artificial intelligence. And now also let's turn to our financial guidance. For fiscal year '25, we're maintaining our revenue guidance of $37.7 billion to $38 billion, growth of 8% to 9% year-over-year. And we now expect fiscal year '25 subscription and support revenue growth to be approximately 10% year-over-year in constant currency. As you can see from our results, we remain committed to profitable growth at scale, and I would also say incredible cash flow. And then continue to expect fiscal year 2025 non-GAAP operating margin of 32.5%, a 200 basis point improvement year-over-year. I'm extremely proud of our team's focus and determination to deliver this world class financial result, including this cash flow and profitability in the quarter. And Brian and Amy will discuss Q1 performance in much greater detail....

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