Salesforce's gross profit margin was impacted by several factors last quarter:
- Cost of Goods Sold (COGS) Growth: The cost of goods sold for Salesforce increased from $2.11 billion to $2.16 billion, representing a year-over-year growth rate of -0.02%1. This slight increase in COGS can negatively impact gross profit margin, especially if the growth does not keep pace with revenue growth.
CRM Cost of Goods Sold, Cost of Goods Sold YoY
- Revenue Growth: While Salesforce's revenue grew by 8.3% year-over-year to $9.44 billion2, this growth may not have fully offset the impact of the COGS increase. The company's gross margin was 76.97% for the quarter, which is still quite healthy but can be affected by the underlying cost dynamics.
- Strategic Investments: Salesforce made strategic investments that impacted its net margin, although the specific impact on gross margin is not detailed. The company's non-GAAP operating margin improved by 33.1% year-over-year to 33.1%, indicating effective cost management despite the investments3.
In conclusion, Salesforce's gross profit margin was impacted by the growth in COGS, which may have outpaced revenue growth, and strategic investments, although the company's overall financial performance remained strong.
3/30/2025 03:20am
