Salesforce has reported third-quarter results for fiscal 2025 (Q3 FY25), surpassing Wall Street estimates and raising its full-year guidance. The AI-powered customer relationship management (CRM) provider’s revenue for the reported quarter, ending 31 October 2024, rose 8% year-over-year (YoY), reaching $9.44bn, driven by robust demand for its cloud-based products and services.
Given the strong performance in Q3, the company improved its full-year revenue guidance for fiscal 2025. The company now expects full-year revenue to be between $37.8bn and $38bn, slightly higher than its previous forecast of $37.7bn to $38bn. Earnings per share (EPS) guidance was also lifted to a range of $6.15 to $6.2, up from $6.05 to $6.13.
Following the release of the earnings report, Salesforce’s stock saw an 8% increase in after-hours trading. The stock has gained approximately 27% in 2024, following positive market sentiment driven by the launch of Salesforce’s Agentforce AI platform during its Dreamforce event in September.
Quarterly performance and earnings growth
Salesforce’s subscription and support revenue, which accounts for the bulk of its income, increased by 9% YoY in the third quarter, totalling $8.88bn. The company’s GAAP diluted net income per share came in at $1.58, an increase from $1.25 in the corresponding quarter of the prior fiscal year. Salesforce’s operating cash flow surged by 29% YoY, amounting to $1.98bn, and free cash flow rose by 30%, reaching $1.78bn.
The primary driver of Salesforce’s revenue growth continues to be its enterprise cloud portfolio, particularly the Salesforce data cloud and new innovations like Agentforce. The company’s enterprise clients, in particular, have been investing heavily in Salesforce’s AI-driven tools to streamline their workflows and manage large volumes of data. On the post-earnings call, Salesforce executives highlighted the success of Agentforce, a new AI product that helps businesses automate tasks with AI agents. The platform has been a key focus for the company, with Salesforce investing heavily in its expansion, including plans to hire 1,400 new employees in Q4 to meet growing demand.
“We delivered another quarter of exceptional financial performance across revenue, margin, cash flow, and cRPO,” Salesforce chair and CEO Marc Benioff said. “Agentforce, our complete AI system for enterprises built into the Salesforce Platform, is at the heart of a groundbreaking transformation. The rise of autonomous AI agents is revolutionising global labour, reshaping how industries operate and scale. With Agentforce, we’re not just witnessing the future—we’re leading it, unleashing a new era of digital labour for every business and every industry.”
Despite the impressive results, analysts are looking for stronger adoption of Salesforce’s services across the enterprise sector to drive further growth. While the company has achieved steady growth, particularly with the integration of AI into its offerings, there is anticipation that broader enterprise adoption will push the company into higher growth rates.
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