CRM Q4 2022 Earnings

Call Details

• Call Title: Salesforce, Inc. Q4 2022 Earnings Call
• Date: March 1, 2022 at 10:00 PM UTC
• Management Team:
  • Evan Goldstein (Senior Vice President of Investor Relations)
  • Marc Benioff (Chair and Co-CEO)
  • Bret Taylor (Vice Chair and Co-CEO)
  • Amy Weaver (Chief Financial Officer)
  • Gavin Patterson (Chief Revenue Officer)

Call Summary

Financial Performance

• Total revenue for Q4 was $7.33B, which includes $312M from Slack, representing 26% year-over-year growth and 27% in constant currency.
• Full fiscal 2022 revenue was $26.5B, up 25% year-over-year and 24% in constant currency, and includes $592M from Slack across two quarters.
• Q4 GAAP EPS was negative $0.03 and Q4 non-GAAP EPS was $0.84, with realized and unrealized investment gains benefiting both by approximately $0.03.
• Full fiscal year GAAP EPS was $1.48 and non-GAAP EPS was $4.78, with realized and unrealized investment gains benefiting GAAP EPS by approximately $0.93 and non-GAAP EPS by approximately $0.98.
• Operating cash flow for the full fiscal year was $6.0B, up 25% year-over-year, and free cash flow was $5.3B, up 29% year-over-year after $717M of CapEx.
• Remaining performance obligation (RPO) ended Q4 at approximately $43.7B, up 21% year-over-year.
• Current remaining performance obligation (CRPO) was approximately $22.0B, up 22% year-over-year and 24% in constant currency, with Slack representing about 4.5 points of CRPO growth.
• Ending Q4 revenue attrition was between 7.0% to 7.5%, which management noted is an all-time low for the company.

Guidance

• Q1 revenue guidance was raised by $130M to $7.37B to $7.38B, implying approximately 24% year-over-year growth and assuming $330M of Slack contribution.
• Full-year fiscal 2023 revenue guidance was raised by $300M to $32.0B to $32.1B, implying approximately 21% year-over-year growth and assuming $1.5B of Slack contribution.
• Guidance assumes a $75M revenue contribution in fiscal 2023 from the announced Traction on Demand acquisition, subject to customary closing conditions.
• Fiscal 2023 GAAP EPS guidance is $0.46 to $0.48 and non-GAAP EPS guidance is $4.62 to $4.64, with Q1 GAAP EPS expected at negative $0.05 to negative $0.04 and Q1 non-GAAP EPS at $0.93 to $0.94.
• The company is reiterating fiscal 2023 non-GAAP operating margin guidance of 20%, representing an expansion of approximately 130 basis points year-over-year.
• Guidance reflects an approximate $300M year-over-year headwind to fiscal 2023 revenue from foreign exchange volatility.
• The company expects fiscal 2023 operating cash flow growth of approximately 21% to 22% year-over-year and anticipates free cash flow growth of approximately 25% to 26%.