Salesforce's Q3 2026 Earnings Call: Contradictions in Agentforce Pricing, AI's Employment Impact, and Strategic Growth Focus

Date of Call: None provided

Financials Results

• Revenue: $10.26B, up 9% year over year (8% in constant currency)
• Operating Margin: Non-GAAP operating margin 35.5%, up 240 basis points year over year

Guidance:

• Organic subscription & support growth ~9% YoY in constant currency; Informatica adds ~80 bps, bringing total to slightly under 10% CC.
• Organic FY26 revenue narrowed to $41.15–$41.25B (~9% nominal, ~8% CC); including Informatica $41.45–$41.55B (~9–10% nominal, ~9% CC).
• Maintain non-GAAP operating margin guidance at 34.1%; GAAP operating margin adjusted to 20.3%.
• Operating cash flow growth raised to ~13–14%; free cash flow growth ~13–14%; capex slightly below 2% of revenue.
• Q4 organic CRPO growth ~11% YoY nominal (~9% CC); inclusive of Informatica ~15% nominal (~13% CC).
• Informatica expected accretive within 12 months.

Business Commentary:

* Revenue Growth and Agentforce Expansion: - Salesforce reported revenue of $10.26 billion for Q3, up 9% year-on-year. - Growth was driven by strong performance in Agentforce, Data 360, and Agentforce Sales and Service.

• Agentforce Adoption and Revenue Increase:
• Agentforce and Data 360 ARR was up 114% year-over-year, including Agentforce ARR at 330% year-over-year.

• The significant adoption and revenue growth are attributed to Agentforce's potential in transforming businesses into "agentic enterprises."

• Operating Cash Flow and Free Cash Flow:

• Operating cash flow was $2.3 billion, up 17% year-over-year, and free cash flow was $2.2 billion, up 22% year-over-year.

• This increase is due to strong bookings and collections performance.

• CRPO and Pipeline Growth:

• Current remaining performance obligation (CRPO) ended Q3 at $29.4 billion, up 11% year-over-year.
• The growth in CRPO is due to strong bookings and early renewals, reflecting a healthy pipeline and continued customer investments.
  

  Sentiment Analysis:

  Overall Tone: Positive

  • Management repeatedly emphasized strong demand and execution: "Q3 revenue was $10.26 billion, up 9% year over year," non-GAAP operating margin of 35.5%, CRPO $29.4B up 11%, Agentforce/Data 360 ARR up 114% and Agentforce ARR up 330% YOY. Commentary focused on accelerating adoption, record bookings, 3.2 trillion tokens processed, and robust cash flow guidance, supporting a positive outlook.

Q&A:

• Question from Keith Weiss (Morgan Stanley): Are customers trying to build their own generative-AI solutions (DIY) or buying from vendors like Salesforce; what are you hearing on customer appetite?
  Response: Customers want vendor solutions — the "last mile" requires context, unified data and deterministic workflows that Salesforce uniquely provides, so demand is shifting from DIY experiments to buying integrated Agentforce solutions.

• Question from Raimo Lenschow (Barclays): You’ve expanded sales rep capacity—how do you think about ramping those reps and their productivity?
  Response: We materially increased capacity (roughly 20–23% year-to-date), ramp AEs in ~6–12 months, and have enabled/accelerated pipeline generation so the added reps will capture strong demand.

• Question from Brad Zelnick (Deutsche Bank): With a large data/infrastructure business emerging, what is Salesforce’s competitive advantage in infrastructure and how does it drive company success?
  Response: Our competitive edge is an integrated data foundation—Informatica + Data 360 + MuleSoft—enabling federated access, master metadata and enterprise context that power accurate, low-hallucination AI and differentiate our apps.

• Question from Brent Thill (Jefferies): What halo effect is Agentforce having across other clouds and on the Slack resurgence?
  Response: Agentforce accelerates adoption and value across Sales, Service, Slack and other clouds by embedding AI into workflows, driving uplift in usage and cross-sell across the rebuilt product portfolio.

• Question from Kirk Materne (Evercore Partners): How have you addressed pricing concerns and how does Salesforce monetize if Agentforce reduces customer headcount?
  Response: We built a flexible commercial portfolio (ILAs, seed-based SKUs, consumption models and flex agreements) to give predictability and enable expandability, preserving AOV growth even as workloads shift.

• Question from Brad Sills (Bank of America): You mentioned refocusing on basics like lead generation—what actions were taken and what impact have they had on pipeline?
  Response: We increased distribution capacity (~23%), invested in enablement, tied comp to priorities and instituted granular measurement, producing a record PipeGen quarter and materially stronger pipeline and bookings.

Contradiction Point 1

Agentforce Pricing Model and Impact on Contract Size

It involves the pricing model and strategy for Agentforce, which directly impacts contract size and expansion, affecting company revenue and investor expectations.

Explain Agentforce's pricing strategy and how Salesforce monetizes when headcount is stable or declining? - Kirk Materne (Evercore Partners)

2026Q3: Agentforce offers flexibility with flat fee, seed-based, and consumption-based pricing options. Commercial frameworks meet customers where they are in their transformation journey. Flex pricing allows for redeployment, ensuring continued revenue even if headcount shifts. - Miguel Milano(CRO)

How does the shift from a seat-based to a consumptive pricing model for Agentforce affect contract size and expansion? - Keith Weiss (Morgan Stanley)

2025Q4: While the initial pricing model for humans was per-user, the shift involves a mix of pricing for human-based clouds and consumption-based products like Agentforce. We cited an example of a telecommunications company deal where Agentforce comprised $7 million, indicating potential for expanding contract size. Brian emphasized the flexibility and positive ROI associated with the consumption-based model, which he expects to provide significant upside in the future. - Marc Benioff(CEO), Brian Millham(COO)

Contradiction Point 2

Role of Agentforce in Enhancing Other Salesforce Products

It highlights the role and impact of Agentforce on other Salesforce products, which could influence customer adoption, integration, and overall market positioning.

How is Agentforce enhancing cloud services, especially Slack, and what is the impact on headcount? - Brent Thill (Jefferies)

2026Q3: Agentforce accelerates the core, enabling omnichannel interactions. Salesforce's ability to integrate humans and AI is a competitive advantage. Slack sees a resurgence as it becomes the primary communications hub for many companies, integrating Agentforce for employee interactions. - Mark Benioff(CEO)

How is Agentforce affecting the usage and effectiveness of other Salesforce products? - Kirk Materne (Evercore ISI)

2025Q4: Agentforce is enhancing existing Salesforce products by providing a halo effect, driving intelligence and efficiency across applications. He observed increased engagement and productivity in core technologies due to Agentforce, highlighting a synergy between apps, data, and agents. - Brian Millham(COO)

Contradiction Point 3

Impact of AI on Employment and Job Roles

It directly impacts the perception of how Salesforce views the role of AI in employment and job roles, which could influence investor expectations and strategic planning.

How does the mismatch between investor expectations and customer behavior in generative AI impact enterprise SaaS solutions (e.g., Salesforce)? - Keith Weiss (Morgan Stanley)

2026Q3: Customers are realizing DIY solutions are challenging and opting for platforms like Salesforce. - Mark Benioff(CEO)

How can Salesforce help companies address the impact of AI on employment while maintaining a human touch? - Mark Murphy (JPMorgan)

2026Q1: Marc addresses AI's current limitations, emphasizing the need for human oversight and the anecdotal evidence of job repositioning rather than job loss. - Marc Benioff(CEO)

Contradiction Point 4

Salesforce's Strategic Focus on Growth

It highlights a shift in Salesforce's strategic focus, particularly regarding the emphasis on small and mid-market segments, which could impact investor perspectives on the company's growth strategy.

How does the mismatch between investor expectations and customer behavior in generative AI affect enterprise SaaS solutions like Salesforce? - Keith Weiss (Morgan Stanley)

2026Q3: Customers are realizing DIY solutions are challenging and opting for platforms like Salesforce. - Mark Benioff(CEO)

How can Agentforce and the Data Cloud drive greater overall growth for Salesforce? - Keith Weiss (Morgan Stanley)

2026Q1: Salesforce plans to hire 1,000-2,000 more salespeople to capitalize on these growth opportunities. - Marc Benioff(CEO)

Contradiction Point 5

AgentForce Capabilities and Market Impact

It involves differing perspectives on the capabilities and market impact of AgentForce, which could influence investor expectations regarding the product's contribution to Salesforce's growth.

Explain Agentforce's pricing strategies and how Salesforce monetizes when headcount is stable or declining? - Kirk Materne (Evercore Partners)

2026Q3: Agentforce offers flexibility with flat fee, seed-based, and consumption-based pricing options. Commercial frameworks meet customers where they are in their transformation journey. - Miguel Milano(CRO)

What leading indicators suggest the Agentforce cycle will be material? - Brad Sills (Bank of America)

2026Q1: Agentforce's impact is seen in the rapid deployment across industries and in core product lines like Sales Cloud and Service Cloud. - Marc Benioff(CEO)