Salesforce Shares Jump After Earnings Beat, Guidance Raise, and $8B Informatica Deal

Salesforce (CRM) shares rose sharply in after-hours trading Wednesday, climbing from $280 to nearly $294 after the company reported better-than-feared fiscal Q1 results and raised its full-year guidance. The pop briefly tested the 200-day moving average at $295 before cooling, as investors weighed solid top- and bottom-line beats against concerns around the company's slowing organic growth and its renewed appetite for acquisitions. The quarter’s headline results were buoyed by better-than-expected current remaining performance obligations (cRPO), but investors remain focused on Salesforce’s long-term strategy, especially following its $8 billion acquisition of Informatica. CEO Marc Benioff’s comments on the earnings call at 5 p.m. ET are expected to provide critical direction for Thursday’s trade.

Salesforce posted adjusted earnings per share of $2.58 on revenue of $9.8 billion, topping analyst expectations of $2.54 and $9.75 billion, respectively. That represented year-over-year revenue growth of 7.6% and demonstrated operating leverage, with an adjusted operating margin of 32.3%. While GAAP net income was essentially flat year-over-year at $1.54 billion, free cash flow improved 4% to $6.3 billion. The strong print extended to the company’s forward outlook as well, as Salesforce issued Q2 guidance that topped consensus and raised its FY26 revenue and EPS outlook across the board.

On a segment basis, subscription and support revenue rose 8% to $9.3 billion, aligning with the company’s broader enterprise-focused model. cRPO, a key gauge of near-term revenue visibility, grew 12% to $29.6 billion, comfortably above expectations of $29.04 billion. This metric helped offset investor concern around decelerating organic revenue, which some argue could push the company further down the M&A path. Notably, over half of Salesforce’s top 100 Q1 deals included six or more cloud products, signaling that cross-selling remains an important lever in the company’s growth strategy.

Salesforce’s guidance for Q2 FY26 calls for adjusted EPS of $2.76 to $2.78 on revenue of $10.11 to $10.16 billion. Analysts were looking for $2.73 on $10.01 billion. Full-year FY26 guidance was also lifted, with the company now forecasting revenue of $41.0 to $41.3 billion, up from its previous range of $40.5 to $40.9 billion. Adjusted EPS guidance was raised to $11.27 to $11.33 from $11.09 to $11.17, while the non-GAAP operating margin was reaffirmed at 34%. Salesforce also reiterated its target of 10% to 11% operating cash flow growth, reinforcing its commitment to profitability.

Still, the standout headline in the report wasn’t strictly financial. On Tuesday, Salesforce announced an $8 billion all-cash acquisition of data management company Informatica, its largest deal since the $27.1 billion Slack acquisition in 2021. Management stated there would be no material impact to FY26 guidance due to the expected timing of the deal’s close in early FY27. Analysts at Stifel called the purchase “a reasonable multiple” and noted it may be better digested by investors than prior large-scale deals. However, the Informatica acquisition has reopened debate about whether Salesforce’s best growth path lies in M&A rather than organic innovation.

Benioff struck an upbeat tone in the company’s prepared remarks, highlighting the role of AI in Salesforce’s long-term vision. He emphasized progress across Data Cloud and the Agentforce platform, which together contributed over $1 billion in ARR—up more than 120% year-over-year. Agentforce has now been deployed in over 8,000 deals since launch, with nearly 60% of Q1 top 100 deals including AI and Data Cloud components. Still, Benioff is likely to face questions from analysts on the call about whether AI momentum can sustain growth without additional inorganic expansion.

Salesforce returned $3.1 billion to shareholders in Q1, including $2.7 billion in share repurchases and $402 million in dividends. Cash and cash equivalents remain strong, providing room for both capital returns and strategic investments. While the company has worked to rebuild investor confidence in its capital discipline following activist pressure in 2022, the Informatica purchase is likely to put that prudence to the test.

Shares of Salesforce have underperformed year-to-date, down about 16% heading into the print. The post-earnings jump reflects a market recalibration as results came in stronger than expected. However, CRM has given up those gains raising some red flags. Technical resistance at the 200-day moving average and the pending call with Marc Benioff loom large. Investors are likely to scrutinize management’s commentary around the long-term revenue trajectory, Informatica integration, and the AI roadmap.

In summary, Salesforce delivered a better-than-expected Q1 earnings report with robust cRPO and strong guidance, sparking a relief rally in its stock. However, concerns about the quality of growth and the need for acquisitions may temper broader enthusiasm. The market reaction is still forming, and much will depend on how effectively Benioff addresses investor questions during the conference call. The company's trajectory into the second half of 2025 may hinge as much on tone as on numbers.