Salesforce releases Q3 results in “huge year of transformation”

Marc Benioff | Salesforce Q3

Salesforce has announced the results for its third quarter fiscal 2024, ending October 31, 2023. The company saw strong total revenue growth of 11 percent year-on-year (YoY) to $8.72bn, beating analysts’ expectations.

Subscription and support revenues saw an increase of 13 percent YoY, reaching $8.14bn. Professional services and other revenues saw a decrease of four percent YoY, slipping to $0.58bn.

Marc Benioff, CEO of Salesforce, said: “We’re obviously super excited about these results. We’ve delivered in this unbelievable quarter and in this unbelievable year. And this double-digit revenue growth, delivering non-GAAP margin exceeding 30 percent, this is really exciting for us.

“And when we look at these numbers, when we think about having an $8.7bn quarter, 31.2 percent margin in the quarter, and then talking about this year at 34.8 percent fiscal year ’24, amazing with 30.5 percent margin growth, whether it’s 800 percent, 900 percent, 1,000 percent increase from YoY, these numbers all exceed what we thought we were able to do.”

Q3 GAAP operating margin was 17.2 percent and non-GAAP operating margin 31.2 percent.

In the earnings call, Salesforce’s C-suite proclaimed its success this quarter with the CEO stating: “It’s also a huge year of transformation.”

The company’s success in Q3 lends itself to the 80 percent growth in deals valued at more than $1m, exceeding expectations. Not only that, its new product, Data Cloud has welcomed more than 1,000 new customers in this quarter alone. Einstein GPT Copilot also drove the strong results this quarter. Einstein is doing 1 trillion transactions a week with 17 percent of the Fortune 100 now being Einstein GPT Copilot customers.

Speaking of the raised guidance, Benioff added: “Based on our performance, we’re raising our fiscal year ’24 revenue guidance in constant currency to 34.8 percent at the high end of the range, 11 percent projected growth YoY. Last quarter raised our fiscal year ’24 non-GAAP operating margin 30 percent and now we’re accelerating again. And we think that we’re going to move this thing to 30.5 percent for the year.”

In Q3, Salesforce saw numerous partnerships and unveiled fresh innovations. One of its latest partnerships saw the company expand its long-standing collaboration with AWS to broaden product integrations across data and AI, and offer select Salesforce products on the AWS marketplace.

Additionally, Salesforce recently launched new AI and data innovations in Sales Cloud to empower sales representatives, leaders and operations teams to sell more efficiently.