Salesforce shares jump 22.6% after strong earnings and higher FY27 outlook

Salesforce shares rose 22.6% on Thursday, posting the company's second-biggest one-day gain on record, a surge not seen since the 2008 financial crisis. The rally followed fiscal second-quarter results that beat expectations, an increase in full-year guidance, and an expanded artificial intelligence partnership with Anthropic. It also marked a sharp reversal for a stock that had fallen steeply through 2025, as investors worried that generative AI could erode the traditional per-seat enterprise software model. (Sources: Reuters, Yahoo Finance, Motley Fool)

Salesforce reported fiscal second-quarter revenue of $11.35 billion, up 11% from a year earlier and slightly above Wall Street's estimate of $11.33 billion. Subscription and support revenue increased 12% to $10.8 billion.

Non-GAAP earnings per share climbed 103% year over year to $5.90, compared with analysts' expectations of about $3.27. GAAP diluted EPS rose 119% to $4.29.

A significant driver of the higher reported profit was Salesforce's investment portfolio. Gains on strategic investments contributed $2.53 of the $5.90 in adjusted EPS, including a substantial gain from the company's investment in Anthropic. Even excluding those investment gains, adjusted EPS of roughly $3.37 would still have come in modestly above consensus, though by a far narrower margin.

Salesforce's AI business also continued to grow. Agentforce and Data 360 annual recurring revenue reached nearly $3.9 billion, while Agentforce ARR alone rose to about $1.5 billion, more than 240% higher than a year earlier. Agentforce, the company's agentic AI product line for automating work such as customer service and sales tasks, was launched in late 2024, making its first year of monetization a key proof point for the strategy.

Salesforce and Anthropic also expanded their partnership with Claudeforce, a product that integrates Anthropic's Claude AI models with Salesforce's enterprise data, workflows and business processes. The initial offering includes dozens of prebuilt AI sales skills. Anthropic, the San Francisco-based AI lab behind the Claude model family and one of OpenAI's main rivals, is a Salesforce portfolio company, so the product deepens a commercial as well as financial relationship between the two firms.

The company lifted its fiscal 2027 revenue forecast to $46.1 billion to $46.4 billion, up from a prior range of $45.9 billion to $46.2 billion. Adjusted EPS guidance was also raised to $16.67 to $16.71, from $14.06 to $14.12 previously.

Current remaining performance obligations, a closely watched indicator of booked future revenue, increased 14% year over year to $33.5 billion. Operating cash flow rose 71% to $1.3 billion, while free cash flow increased 81% to $1.1 billion in the quarter.

The results gave investors evidence that AI may complement rather than simply disrupt enterprise software. The Anthropic partnership, faster Agentforce adoption and stronger guidance helped ease concerns about an AI-driven threat to SaaS companies. Open questions heading into coming quarters include whether Agentforce ARR continues to compound at a rapid rate, how quickly Claudeforce converts into booked revenue, and how much of future earnings growth comes from core operations rather than further investment portfolio gains.