Executive Summary
Salesforce’s QQ1 2026 results reflect a resilient SaaS franchise with solid top-line performance and strong cash generation. Revenue reached $9.829 billion, up 7.6% year over year despite a modest sequential decline of about 1.6% from the prior quarter, underscoring continued demand for the Salesforce Customer 360 suite and adjacent offerings. The company delivered an expanding margin profile and robust free cash flow, highlighted by gross margin of ~76.96% and operating margin of ~19.76%, supported by disciplined cost management and scale benefits.
Strategically, Salesforce continues to monetize its multi-product platform (Sales/Service/Marketing/Commerce, Tableau, MuleSoft, Slack) with ongoing AI-enhancement efforts and strong cross-sell dynamics. Free cash flow totaled approximately $6.30 billion for the quarter, underpinning a healthy balance sheet with modest net debt (~$441 million) and substantial liquidity. The combination of a strong ARR engine, optionality in AI-enabled features, and prudent capital allocation (share repurchases and strategic investments) positions Salesforce to sustain profitability while continuing product-led growth. Investors should monitor trajectory of revenue growth versus AI monetization, mix shifts across product lines, and the pace of operating-expense optimization as the company scales.
Overall, the QQ1 2026 print reinforces Salesforce as a leading CRM platform with durable profitability and significant free cash flow generation, though near-term headline growth may hinge on the cadence of large multi-product deals and ongoing cost discipline.
Key Performance Indicators
Key Insights
Revenue: $9.829B (YoY +7.62%; QoQ -1.64%)
Gross Profit: $7.564B (YoY +8.51%; QoQ -2.73%)
Operating Income: $1.942B (YoY +13.63%; QoQ +6.70%)
Net Income: $1.541B (YoY +0.52%; QoQ -9.78%)
EPS (diluted): $1.59; Core EPS (GAAP): $1.61
Gross Margin: 76.96%
Operating Margin: 19.76%
EBITDA: $2.749B; EBITDA Margin: 27.97%
Income Before Tax Margin: 20.08%
Net Income Margin: 15.68%
Weighted Avg Shares (diluted): ~970.0M
Cash From Operations: $6.476B
Capital Expenditures: -$0.179B
Free Cash Flow: $6.297B
C...
Financial Highlights
Revenue: $9.829B (YoY +7.62%; QoQ -1.64%)
Gross Profit: $7.564B (YoY +8.51%; QoQ -2.73%)
Operating Income: $1.942B (YoY +13.63%; QoQ +6.70%)
Net Income: $1.541B (YoY +0.52%; QoQ -9.78%)
EPS (diluted): $1.59; Core EPS (GAAP): $1.61
Gross Margin: 76.96%
Operating Margin: 19.76%
EBITDA: $2.749B; EBITDA Margin: 27.97%
Income Before Tax Margin: 20.08%
Net Income Margin: 15.68%
Weighted Avg Shares (diluted): ~970.0M
Cash From Operations: $6.476B
Capital Expenditures: -$0.179B
Free Cash Flow: $6.297B
Cash at End of Period: $10.928B
Total Current Assets: $25.866B; Total Assets: $98.61B
Total Current Liabilities: $24.196B; Total Liabilities: $37.944B; Total Stockholders’ Equity: $60.666B
Debt (Short + Long): $11.369B; Net Debt: $0.441B
Liquidity indicators: Strong liquidity position with sizable cash and investments; Opex structure (S&M + G&A) ~41% of revenue; R&D noted at $1.460B for this period.
Notes: YoY and QoQ figures reflect the disclosed QQ1 2026 metrics; the quarter benefited from operating leverage and a robust cash-generation profile, with a high gross margin typical of leading SaaS platforms.
Income Statement
| Metric |
Value |
YoY Change |
QoQ Change |
| Revenue |
9.83B |
7.62% |
-1.64% |
| Gross Profit |
7.56B |
8.51% |
-2.73% |
| Operating Income |
1.94B |
13.63% |
6.70% |
| Net Income |
1.54B |
0.52% |
-9.78% |
| EPS |
1.61 |
1.90% |
-9.55% |
Management Commentary
Management themes (QQ1 2026) highlighted the following:
- AI and Platform Strategy: Emphasis on embedding AI capabilities across the Customer 360 suite and expanding the use of Slack, Tableau, and MuleSoft to drive cross-sell opportunities and higher ARPU.
- Growth Execution and AI monetization: Focus on expanding large multi-product deals and improving customer retention through enhanced analytics and personalized experiences.
- Efficiency and Cash Flow: Continued commitment to operating leverage and free cash flow generation, with a disciplined approach to R&D spend and operating expenses to support long-term growth.
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Forward Guidance
No explicit numeric full-year guidance was provided in the data set for QQ1 2026. However, given the multi-product portfolio and the ongoing AI initiatives, a reasonable scenario-based view suggests mid-single-digit to low-double-digit revenue growth over the next few quarters as AI-enabled features scale and cross-sell grows. Investors should monitor: (1) ARR growth and net revenue retention, (2) progression in AI monetization and average contract value per customer, (3) progression of operating expenses versus revenue (opex leverage), (4) potential FX translation effects given international exposure, and (5) cadence of large enterprise deals and onboarding costs associated with platform upgrades.