Salesforce Inc. posted a fiscal second-quarter performance that materially outpaced Wall Street expectations, driven by heightened demand for its AI and data products and improving profitability. Shares jumped 11% in after-hours trading following the companys results and updated outlook.
Quarterly results and market reaction
Adjusted earnings per share came in at $5.90, a beat of $2.63 versus the analyst estimate of $3.27. Revenue for the period reached $11.3 billion, in line with consensus and representing 11% year-over-year growth. The market responded strongly to the combination of earnings upside, margin expansion, and managements upgraded guidance.
Upgraded full-year outlook
For fiscal 2027, Salesforce raised its revenue guidance to a range of $46.1 billion to $46.4 billion, implying year-over-year growth of 11% to 12%. The midpoint of that range, $46.25 billion, sits above analysts consensus of $46.11 billion. The company also increased its full-year adjusted EPS guidance to $16.67 to $16.71, ahead of the consensus forecast of $14.16.
In managements commentary, Marc Benioff, Chair and CEO, said: "We just delivered one of our best quarters ever, outperforming across every key metric. AI is delivering value across every layer of our platform. Were seeing incredible demand for our AI and data products, with ARR about to cross $4 billion."
Quarterly guidance and product momentum
Looking to the third quarter, Salesforce expects revenue between $11.42 billion and $11.5 billion, with a midpoint of $11.46 billion that is marginally above the consensus estimate of $11.42 billion. The company set third-quarter adjusted EPS guidance at $3.42 to $3.44, compared with the analyst estimate of $3.39.
Salesforce reported that Agentforce and Data 360 combined annual recurring revenue reached nearly $3.9 billion, up more than 210% year-over-year, while Agentforce ARR alone exceeded $1.5 billion, an increase of over 240% year-over-year. Current remaining performance obligation rose 14% year-over-year to $33.5 billion.
Profitability and cash flow
Adjusted operating margin for the quarter was 34.1%. Operating cash flow increased 71% year-over-year to $1.3 billion, reflecting both revenue growth and margin improvement during the period.
This set of results prompted a notable positive market reaction and an upward revision to the companys fiscal outlook, driven in large part by demand for its AI and data-focused offerings and measurable gains in profitability and cash generation.