Raises FY22 Revenue Guidance to $25.9 Billion to $26.0 Billion
- First Quarter Revenue of $5.96 Billion, up 23% Year-Over-Year, 20% in Constant Currency
- Current Remaining Performance Obligation of Approximately $17.8 Billion, up 23% Year-Over-Year, 20% in Constant Currency
- First Quarter Operating Cash Flow of $3.23 Billion, up 74% Year-Over-Year
- First Quarter GAAP Operating Margin of 5.9% and Non-GAAP Operating Margin of 20.2%
- Raises FY22 GAAP Operating Margin Guidance to Approximately 1.4% and Non-GAAP Operating Margin Guidance to Approximately 18.0%
- Initiates Second Quarter FY22 Revenue Guidance of $6.22 Billion to $6.23 Billion, up Approximately 21% Year-Over-Year
Salesforce (NYSE: CRM), the global leader in CRM, today announced results for its first quarter of fiscal 2022 ended April 30, 2021.
“We had the best first quarter in our company’s history,” said Marc Benioff, Chair & CEO, Salesforce. “We believe our Customer 360 platform is proving to be the most relevant technology for companies accelerating out of the pandemic. With incredible momentum throughout our core business, we’re raising our revenue guidance for this fiscal year by $250 million to approximately $26 billion and non-GAAP operating margin to 18 percent. We’re on our path to reach $50 billion in revenue in FY26.”
“Our performance in the first quarter was strong across all financial metrics,” said Amy Weaver, President and Chief Financial Officer, Salesforce. “We saw record levels of new business and strength across all products, regions, and customer sizes. Our impressive start to this year helps fuel our momentum for the rest of the year as we keep pace toward our goal of $50 billion in revenue in FY26.”
Salesforce delivered the following results for its fiscal first quarter:
Revenue: Total first quarter revenue was $5.96 billion, an increase of 23% year-over-year, and 20% in constant currency. Subscription and support revenues for the quarter were $5.54 billion, an increase of 21% year-over-year. Professional services and other revenues for the quarter were $0.43 billion, an increase of 47% year-over-year.
Operating Margin: First quarter GAAP operating margin was 5.9%. First quarter non-GAAP operating margin was 20.2%.
Earnings per Share: First quarter GAAP diluted earnings per share was $0.50, and non-GAAP diluted earnings per share was $1.21. Mark-to-market accounting of the company’s strategic investments benefited GAAP diluted earnings per share by $0.23 based on a U.S. tax rate of 25% and non-GAAP diluted earnings per share by $0.24 based on a non-GAAP tax rate of 21.5%.
Cash: Cash generated from operations for the first quarter was $3.23 billion, an increase of 74% year-over-year. Total cash, cash equivalents and marketable securities ended the first quarter at $15.02 billion.
Remaining Performance Obligation: Remaining performance obligation ended the first quarter at approximately $35.0 billion, an increase of 19% year-over-year. Current remaining performance obligation ended the first quarter at approximately $17.8 billion, an increase of 23% year-over-year, 20% in constant currency.
As of May 27, 2021, the company is initiating its revenue guidance, GAAP earnings per share guidance, non-GAAP earnings per share guidance, and current remaining performance obligation growth guidance for its second quarter of fiscal year 2022. As of May 27, 2021, the company is raising its revenue guidance previously provided on December 1, 2020 and updated on February 25, 2021 for its full fiscal year 2022. As of May 27, 2021 the company is raising its operating cash flow guidance, GAAP earnings per share guidance, non-GAAP earnings per share guidance, GAAP operating margin guidance and non-GAAP operating margin guidance previously provided on February 25, 2021 for its full fiscal year 2022.
Management will provide further commentary around these guidance assumptions on its earnings call, which is expected to occur on May 27, 2021 at 2:00 PM Pacific Time.
Our guidance assumes no change to the value of the company’s strategic investment portfolio as it is not possible to forecast future gains and losses. In addition, the guidance below is based on estimated GAAP tax rates that reflect the company’s currently available information, and excludes forecasted discrete tax items such as excess tax benefits from stock-based compensation. The GAAP tax rates may fluctuate due to future acquisitions or other transactions.
(1) The Company’s GAAP tax provision is expected to be approximately 132% for the three months ended July 31, 2021, and approximately 44% for the year ended January 31, 2022. The GAAP tax rates may fluctuate due to discrete tax items and related effects in conjunction with certain provisions in the Tax Cuts and Jobs Act, future acquisitions or other transactions.
(2) The Company’s projected GAAP and Non-GAAP diluted earnings (loss) per share assumes no change to the value of our strategic investment portfolio as it is not possible to forecast future gains and losses. While historically the company’s strategic investment portfolio has had a positive impact on the company’s financial results, that may not be true for future periods, particularly in periods of significant market fluctuations that affect the publicly traded companies within the company’s strategic investment portfolio. The impact of future gains or losses from the company’s strategic investment portfolio could be material.
(3) The Company’s Non-GAAP tax provision uses a long-term projected tax rate of 21.5%, which reflects currently available information and could be subject to change.
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