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Salesforce reported Q2 FY27 on August 26 and the stock went up a stunning 23%. And almost every other B2B stock went up along with it, Is the SaaSpocolypse … over? Well, it may be past the panic selling of earlier in the year at least at least. Salesforce did re-accelerate on bookings, and that was important: - Revenue of $11.345B, up 11% - cRPO (future bookings) up 14%. That’s big re-acceleration - Non-GAAP EPS of $5.90, up 103% - FY27 guidance raised to $46.1B-$46.4B - Benioff opened the call declaring the “SaaSpocalypse” over. The forward book genuinely accelerated, the organic business grew about 6%, and the earnings blowout came almost entirely from a mark-up on Salesforce’s stake in Anthropic plus a $25B buyback. Our 5 interesting learnings. #1. cRPO accelerated to 14% while revenue grew 11% Current remaining performance obligation hit $33.5B, up 14% year-over-year and in constant currency. The trajectory: - Q2 FY26: 10% - Q1 FY27: 13% - Q2 FY27: 14% - Q3 FY27 guide: ~14%, and that guide explicitly excludes any contribution from the pending Contentful and Fin acquisitions Contracted-but-unrecognized revenue growing 3 points faster than recognized revenue is the number worth spending time on, because revenue at a company this size reflects deals signed 12 to 24 months ago while cRPO reflects what got signed in the last 90 days. Robin Washington said this is what the entire company was compensated on this year: net new annual order value growth outpacing total AOV growth, which is the mechanical precondition for organic revenue reacceleration in H2. A few qualifications. - Informatica’s contract base sits inside cRPO too, so part of the 14% is bought. - And the noncurrent piece of RPO grew only 7.5% ($30.5B to $32.8B), with total RPO up 10.7% to $66.3B. - All of the acceleration is inside the next twelve months. Management said contract length improved across all segments, which should push value into the noncurrent bucket. It didn’t. Atlassian got a 35% one-day move on 44% RPO growth three weeks ago. Salesforce got 23% on 14%. The market is pricing the order book right now, and if you have one, the current-versus-noncurrent split is the part that gets read. #2. Strip out Informatica and Salesforce grew 6.4% Reported revenue growth: 11%. Informatica contributed $456M in the quarter. Back it out and the organic business grew 6.4% ($10.889B vs $10.236B). Subscription and support strips from 12% to about 7%. Where the acquisition sits matters more than the top-line adjustment. Salesforce now reports two revenue lines, Agentforce Apps and Data/Platform/Other. Informatica lives entirely in the second bucket. Take out its $440M of subscription revenue and the segment everyone points to as the growth engine grew 5.7% organically, slower than the core apps. Washington’s words on the call: the Data 360 and Headless line was fueled by Informatica and Data 360, “partially offset by license revenue headwinds and volatility in integration and analytics.” That’s MuleSoft and Tableau. Marketing got “early signs of recovery” with an immediate caveat that it’s “too soon to call this a sustainable trend.” The +7.6% apps number also includes Slack, which had its best net new AOV quarter since the acquisition. Core Sales and Service ex-Slack is growing slower than 7.6%. Salesforce disclosed everything needed to do this subtraction. It took about four minutes with the segment table and the $440M Informatica line from the same press release. #3. Non-GAAP net income excluding investment gains went down EPS was up 103%. Operating income was $2,331M versus $2,332M a year ago. Flat. On 11% more revenue. The bridge: - Salesforce booked $2,613M in gains on strategic investments in the quarter, which added $2.53 to non-GAAP EPS and $2.43 to GAAP EPS. Prior year: $0.00. - Diluted share count fell from 962M to 821M, down 14.7%, on a $25B accelerated share repurchase funded with $24.8B of new debt. Strip the investment gains and non-GAAP net income was $2,767M versus $2,795M a year ago. Down 1%. Ex-gains EPS of roughly $3.37 versus $2.91, and every point of that 16% came from the smaller share count. Benioff on what drove the gain: “Take the value of Slack. Then take the value of our Anthropic stock. That has been like half our value.” The strategic investment portfolio went from $7.6B to $11.3B in six months. The buyback has a running cost. Interest expense went from $67M to $473M in one year. Noncurrent debt went from $10.4B to $39.3B. Total stockholders’ equity fell from $59.1B to $38.4B. Buying back 14% of the shares at an average price of $176 with the stock now at $259 was a good trade, and holding Anthropic equity was a better one. Both were capital allocation decisions. The operating business produced $2,331M of income on $11.345B of revenue, the same dollar figure it produced on $10.236B a year ago. #4. AI and Data is ~$3.9B ARR, about 8% of revenue, and the CEO says most customers haven’t started The AI numbers are big: - Agentforce and Data 360 ARR: ~$3.9B, up over 210% - Agentforce ARR alone: over $1.5B, up over 240% - 3.2 billion Agentic Work Units in Q2, up 97% quarter-over-quarter - Agentforce bookings doubled year-over-year, with 50% of bookings coming from customers refilling Flex Credits - Data 360 ingested 104 trillion records, 82 trillion of them via Zero Copy Two things temper them. The $1.5B Agentforce figure is not a clean comp: effective this quarter, Salesforce redefined Agentforce ARR to include Slackbot and Headless 360, so the 240% is measured against a base that no longer means the same thing. And the $3.9B bundles Data 360, a data platform that predates the agent era. At $45B of annualized revenue, $3.9B is about 8.6% of the business. Penetration is thinner than the growth rates suggest: - Miguel Milano: Salesforce added 2,000 paying customers into production this quarter, and accounts with agents in production grew 70% quarter-over-quarter. That math implies fewer than 5,000 production accounts total, against a customer base north of 150,000. - Milano again: “Only 5% of the knowledge workers that use sales and service have upgraded to the higher-end editions.” Those editions carry a 60-80% price premium and are the gate for Claudeforce and headless. - Benioff, on the customers he met across two months in Europe: “Most of them have not started their AI transformations yet.” Two years into Agentforce: 8% of revenue, roughly 3% of accounts in production, 5% on the premium tier. If you are comparing your own AI attach rate to Salesforce’s press release, the production-account number is the closer comparison. #5. Salesforce is running four pricing models at once, and Benioff says they’re still stuck on seats Asked about monetizing headless deployments, Benioff said: “We’re still trapped in some ways in old per user pricing models. But the opportunity to build much more aggressive pricing, to really represent the value that we’re offering our customers, I think is enormous.” — Marc Benioff Salesforce is now simultaneously selling per user, per agent, per consumption unit via Flex Credits, and per outcome. Milano described an active negotiation with a $40M customer running an activation agent at 45 million AWUs, choosing between an outcome-based deal and an unlimited license agreement. Benioff went past transaction-based outcome pricing: “we improved revenue by this much, so give us $2 because we made you $20.” What agents are worth to Salesforce today: $1.5B of Agentforce ARR is $375M a quarter. Against 3.2 billion AWUs, that’s roughly 12 cents per agentic work unit. (The AWU count spans Agentforce and Slack, so treat it as an order of magnitude, not a rate card.) A single Agentforce seat runs $125/user/month. The premium-edition push exists to close that gap. The human side is expanding at the same time. Salesforce is at 15,000 account executives and plans to hire 1,200 more before the fiscal year ends, while taking $94M of restructuring charges in the same quarter. A Few More Things - Subscription gross margin fell 170bps, from 83.0% to 81.3%. Cost of subscription revenue grew 23% against 12% subscription revenue growth, and it’s still up 20% after backing out acquisition intangible amortization. Total gross margin went 78.1% to 76.6%. The same AI-inference margin pattern showing up at Figma and Canva, just smaller. - Free cash flow was $1.098B, up 81%, but full-year FCF growth guidance stayed at 4-5%. The quarterly figure is a seasonal artifact of receivables timing. - Salesforce’s own support agent has handled 5 million conversations with 64% resolved autonomously, and Slackbot is generating a claimed 8.1 million hours of annualized internal productivity. The customer-zero numbers are more specific than most of the customer case studies. - Slackbot hit 1 million active users five months after launch, up 150% quarter-over-quarter, and upgrades to premium Slack editions tripled since it shipped. Slack was the best-performing asset in the quarter, five years after the acquisition everyone panned. - Nine of the top 10 AI companies run on Salesforce and Slack, and their combined spend is up 435%. Anthropic is a customer, a partner via Claudeforce, and the largest single driver of Salesforce’s earnings beat. That is a lot of correlated exposure to one counterparty. What To Watch at Dreamforce, and Going Forward Three numbers settle whether Q2 was the start of a reacceleration. - Does organic revenue growth actually pick up in Q3 and Q4? Management committed to it and called Q3 “math.” The Informatica contribution anniversaries out of the comp starting in Q4 FY27, and when it does, the reported growth rate and the organic growth rate become the same number. - Does noncurrent RPO start growing again? Current RPO at 14% with noncurrent at 7.5% means the acceleration is loaded into the next four quarters. - Does premium-edition penetration move off 5%? Claudeforce, headless, and every agentic capability Benioff demoed sit behind that upgrade, at a 60-80% premium. Converting that 5% is how the $3.9B of AI ARR gets to $10B. If it’s still 5% in February, $3.9B is roughly where AI revenue sits. Fingers crossed. The tsunami of AI has just began to wash over pre-AI B2B software. It’s just begun. But there are signs the best are riding the wave, finally. Instead of just being crushed by it.
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