Share count
956Mpeak FY2023
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CRM, Salesforce Inc.
Salesforce sells software that companies rent to manage their dealings with customers — tracking sales, handling service, and running marketing and commerce. It is sold almost entirely by subscription and delivered over the internet, so customers pay year after year to keep the service running rather than buying once. The pitch is to gather a firm's scattered customer records into one place that its people and its software agents all work from.
Our artificial intelligence ("AI") powered Agentforce 360 Platform unites our offerings — spanning sales, service, marketing, commerce, collaboration, data management, integration, analytics, IT service, industry verticals and more — on a single, intelligent platform for trusted enterprise execution.
We unify and harmonize across systems, applications and devices to create a complete view of customers.
Read in Notes: The Moat and the Multiple, Jul 16, 2026
The business
What it sells, where the money comes from, the kind of company it is.
Revenue · FY2026
$41.5B
+9.6% YoY · 14% 5-yr CAGR
Vital signs · TTM, with 5-yr average
Revenue $42.8B 5-yr avg $34.4B
Revenue $11.1B +13.3% vs yr-ago qtr
Operating margin 21.1% yr-ago 19.8%
Net income $2.1B yr-ago $1.5B
Net margin 18.9% yr-ago 15.7%
The business in brief
read the 10-K →What this business is and what moves its needle, from its own SEC filings.
- What it is
- Revenue is led by Agentforce Service (24%) and Agentforce Sales (22%), with 4 more lines behind.
- Situation
- Serial acquirer. Goodwill and acquired intangibles are 58% of assets, with meaningful acquisition spending in 7 of the record's 10 years; much of what this business is was bought, at prices the record carries.
- What moves the needle
- The test is whether customer data, once loaded and woven into a firm's daily work, is hard enough to pull out to hold rivals off and to let Salesforce raise the price — switching costs and pricing power are what govern the outcome, and their evidence would show in renewal rates and in revenue per customer. The filing itself calls the market crowded, fast-moving, and cheap to enter, which is the bad case: software anyone can copy earns no more than its cost of capital. It also leans on a thin bench of technical people and carries debt with covenants to mind. Whether the franchise is real shows in the margins, the return on capital, and the cash in the record below.
- Is it a good business?
- Return on capital has rarely cleared the cost of capital (median 3%, above 15% in 0 of 10 years). The steadier read is owner earnings: roughly 22% of revenue reaches owners as cash, consistently. This is price-taker territory, where the balance sheet and the cycle matter more than any multiple; the rest is in the 10-K.
Drafted from the company's filings and reviewed by hand; every number is shown in full in the sections below.
Where the money comes from
read the 10-K →Revenue spreads across 6 lines, the largest Agentforce Service at 24%.
Revenue by product line, FY2026
- Agentforce Service24%$9.8B
- Agentforce Sales22%$9.0B
- Agentforce 360 Platform, Slack and Other21%$8.9B
- Agentforce Integration and Agentforce Analytics15%$6.2B
- Agentforce Marketing and Agentforce Commerce13%$5.4B
- Professional services and other5%$2.1B
By geographyAmericas65%Europe24%Asia Pacific10%
From the segment footnote of the company's own 10-K. Shares are of total revenue; the profit bar shows each segment's share of segment operating profit, before unallocated corporate costs.
The record
Ten years of arithmetic, read across the cycle.
The record, 2017–2026
realized figures from each filing · older years to the left| 2017’17 | 2018’18 | 2019’19 | 2020’20 | 2021’21 | 2022’22 | 2023’23 | 2024’24 | 2025’25 | 2026’26 | TTMTTMApr 2026 | |
|---|---|---|---|---|---|---|---|---|---|---|---|
| Income statement | |||||||||||
| $8.4B | $10.5B | $13.3B | $17.1B | $21.3B | $26.5B | $31.4B | $34.9B | $37.9B | $41.5B | $42.8B | RevenueRevenue |
| 74% | 74% | 74% | 75% | 74% | 73% | 73% | 75% | 77% | 78% | 78% | Gross marginGross mgn |
| 11% | 10% | 10% | 10% | 10% | 10% | 8% | 7% | 7% | 7% | 7% | SG&A / revenueSG&A/rev |
| 14% | 15% | 14% | 16% | 17% | 17% | 16% | 14% | 14% | 14% | 14% | R&D / revenueR&D/rev |
| $218M | $454M | $535M | $297M | $455M | $548M | $1.0B | $5.0B | $7.2B | $8.3B | $8.7B | Operating incomeOp. inc. |
| 2.6% | 4.3% | 4.0% | 1.7% | 2.1% | 2.1% | 3.3% | 14.4% | 19.0% | 20.1% | 20.4% | Operating marginOp. mgn |
| $323M | $360M | $1.1B | $126M | $4.1B | $1.4B | $208M | $4.1B | $6.2B | $7.5B | $8.0B | Net incomeNet inc. |
| — | 14% | — | — | — | 6% | — | 16% | 17% | 22% | 22% | Effective tax rateTax rate |
| Cash flow & returns | |||||||||||
| $2.2B | $2.7B | $3.4B | $4.3B | $4.8B | $6.0B | $7.1B | $10.2B | $13.1B | $15.0B | $15.2B | Operating cash flowOp. cash |
| $632M | $373M | $411M | $455M | $579M | $678M | $903M | $1.1B | $1.0B | $1.2B | $1.3B | DepreciationDeprec. |
| $387M | $1.0B | $594M | $2.0B | ($2.0B) | $1.1B | $2.7B | $2.2B | $2.7B | $2.8B | $2.3B | Working capital & otherWC & other |
| $464M | $534M | $595M | $643M | $710M | $717M | $798M | $736M | $658M | $594M | $560M | CapexCapex |
| 5.5% | 5.1% | 4.5% | 3.8% | 3.3% | 2.7% | 2.5% | 2.1% | 1.7% | 1.4% | 1.3% | Capex / revenueCapex/rev |
| $1.7B | $2.4B | $3.0B | $3.9B | $4.1B | $5.3B | $6.3B | $9.5B | $12.4B | $14.4B | $14.7B | Owner earningsOwner earn. |
| 20.1% | 22.4% | 22.5% | 22.7% | 19.2% | 19.9% | 20.1% | 27.2% | 32.8% | 34.7% | 34.2% | Owner earnings marginOE mgn |
| $1.7B | $2.2B | $2.8B | $3.7B | $4.1B | $5.3B | $6.3B | $9.5B | $12.4B | $14.4B | $14.7B | Free cash flowFCF |
| 20.1% | 20.9% | 21.1% | 21.6% | 19.2% | 19.9% | 20.1% | 27.2% | 32.8% | 34.7% | 34.2% | Free cash flow marginFCF mgn |
| $3.2B | $25M | $5.1B | $369M | $1.3B | $14.9B | $439M | $82M | $2.7B | $9.3B | $10.7B | AcquisitionsAcquis. |
| — | — | — | — | — | — | $0 | $0 | $1.5B | $1.6B | $1.6B | Dividends paidDiv. paid |
| — | — | — | — | $0 | $0 | $4.0B | $7.6B | $7.8B | $12.6B | — | BuybacksBuybacks |
| 3% | 4% | 3% | 0% | 1% | 1% | 1% | 7% | 10% | 10% | 11% | ROICROIC |
| 4% | 3% | 7% | 0% | 10% | 2% | 0% | 7% | 10% | 13% | 23% | Return on equityROE |
| — | — | — | — | — | — | 0% | 7% | 8% | 10% | 19% | Retained to equityRetained/eq |
| Balance sheet | |||||||||||
| $1.6B | $2.5B | $2.7B | $4.1B | $6.2B | $5.5B | $7.0B | $8.5B | $8.8B | $7.3B | $9.5B | Cash & investmentsCash+inv |
| $3.2B | $3.9B | $4.9B | $6.2B | $7.8B | $9.7B | $10.8B | $11.4B | $11.9B | $14.3B | $5.1B | ReceivablesReceiv. |
| $115M | $76M | $165M | — | — | — | — | — | — | — | $165M | Accounts payablePayables |
| $3.1B | $3.8B | $4.8B | $6.2B | $7.8B | $9.7B | $10.8B | $11.4B | $11.9B | $14.3B | $4.9B | Operating working capitalOper. WC |
| $6.0B | $9.6B | $10.7B | $16.0B | $21.9B | $22.9B | $26.4B | $29.1B | $29.7B | $28.2B | $21.6B | Current assetsCur. assets |
| $7.3B | $10.1B | $11.3B | $14.8B | $17.7B | $21.8B | $25.9B | $26.6B | $28.0B | $37.1B | $27.5B | Current liabilitiesCur. liab. |
| 0.8× | 1.0× | 0.9× | 1.1× | 1.2× | 1.0× | 1.0× | 1.1× | 1.1× | 0.8× | 0.8× | Current ratioCurr. ratio |
| $7.3B | $7.3B | $12.9B | $25.1B | $26.3B | $47.9B | $48.6B | $48.6B | $51.3B | $57.9B | $59.3B | GoodwillGoodwill |
| $17.6B | $22.0B | $30.7B | $55.1B | $66.3B | $95.2B | $98.8B | $99.8B | $102.9B | $112.3B | $106.7B | Total assetsAssets |
| $2.0B | $1.7B | $3.2B | $2.7B | $2.7B | $10.6B | $10.6B | $9.4B | $8.4B | $14.4B | $39.3B | Total debtDebt |
| $401M | ($823M) | $507M | ($1.5B) | ($3.5B) | $5.1B | $3.6B | $954M | ($415M) | $7.1B | $29.7B | Net debt / (cash)Net debt |
| 2.4× | 5.2× | 3.5× | — | — | — | — | — | — | — | 56.7× | Interest coverageInt. cov. |
| $8.2B | $10.4B | $15.6B | $33.9B | $41.5B | $58.1B | $58.4B | $59.6B | $61.2B | $59.1B | $34.2B | Shareholders’ equityEquity |
| 9.7% | 9.5% | 9.7% | 10.4% | 10.3% | 10.5% | 10.5% | 8.0% | 8.4% | 8.5% | 8.3% | Stock comp / revenueSBC/rev |
| Per share | |||||||||||
| 700M | 735M | 775M | 850M | 930M | 974M | 997M | 984M | 974M | 956M | 871M | Shares out (diluted)Shares |
| $12.05 | $14.34 | $17.14 | $20.12 | $22.85 | $27.20 | $31.45 | $35.42 | $38.91 | $43.44 | $49.17 | Revenue / shareRev/sh |
| $0.46 | $0.49 | $1.43 | $0.15 | $4.38 | $1.48 | $0.21 | $4.20 | $6.36 | $7.80 | $9.21 | EPS (diluted)EPS |
| $2.43 | $3.22 | $3.85 | $4.56 | $4.40 | $5.42 | $6.33 | $9.65 | $12.77 | $15.06 | $16.83 | Owner earnings / shareOE/sh |
| $2.43 | $3.00 | $3.62 | $4.34 | $4.40 | $5.42 | $6.33 | $9.65 | $12.77 | $15.06 | $16.83 | Free cash flow / shareFCF/sh |
| — | — | — | — | — | — | $0.00 | $0.00 | $1.58 | $1.66 | $1.78 | Dividends / shareDiv/sh |
| $0.66 | $0.73 | $0.77 | $0.76 | $0.76 | $0.74 | $0.80 | $0.75 | $0.68 | $0.62 | $0.64 | Cap. spending / shareCapex/sh |
| $11.76 | $14.12 | $20.14 | $39.86 | $44.62 | $59.68 | $58.53 | $60.62 | $62.81 | $61.86 | $39.31 | Book value / shareBVPS |
Per-share growththe realized rate an owner's share compounded
| 9-yr | 5-yr | |
|---|---|---|
| Revenue / share | +15.3%/yr | +13.7%/yr |
| Owner earnings / share | +22.5%/yr | +27.9%/yr |
| EPS | +36.9%/yr | +12.2%/yr |
| Capital spending / share | −0.7%/yr | −4.0%/yr |
| Book value / share | +20.3%/yr | +6.8%/yr |
The record, charted
FY2017–2026Each measure over its full record; the current point and the worst year marked.
ROIC
10%low FY2020
Gross margin
78%low FY2023
Net debt ÷ owner earnings
0.5×peak FY2022
Owner earnings vs. net income
Owner earningsNet incomeThe accountant's number, and the cash an owner can take; the gap is the tell.
$14.4Bowner earningsvs.$7.5Bnet incomelow FY2017
Where the cash went
ReinvestBuybacksDividendsAcquisitionsRetainedBeyond op. cashEach year's outlays against its operating cash: the mix, and how it drifts. The hatched cap is spending beyond that year's operating cash — financed from the balance sheet or borrowing, not operations.
FY2017FY2026
Net income is the accountant's number; owner earnings is the cash an owner could take out. The walk between them, off the cash-flow statement, and whether the gap is widening or holding.
In fiscal 2026 the business turned $7.5B of profit into $14.4B of owner earnings: more cash than the profit line showed, after the non-cash charges and the capital it put back in.
| FY2026 | FY2025 | FY2024 | FY2023 | FY2022 | |
|---|---|---|---|---|---|
| Reported net income | $7.5B | $6.2B | $4.1B | $208M | $1.4B |
| Depreciation & amortizationnon-cash charge added back | +$1.2B | +$1.0B | +$1.1B | +$903M | +$678M |
| Stock-based compensationreal costnon-cash, but a real cost | +$3.5B | +$3.2B | +$2.8B | +$3.3B | +$2.8B |
| Working capital & othertiming of cash in and out, other non-cash items | +$2.8B | +$2.7B | +$2.2B | +$2.7B | +$1.1B |
| Cash from operations | $15.0B | $13.1B | $10.2B | $7.1B | $6.0B |
| Capital expenditurecash put back in to keep running and to grow | −$594M | −$658M | −$736M | −$798M | −$717M |
| Owner earnings | $14.4B | $12.4B | $9.5B | $6.3B | $5.3B |
| Owner-earnings marginowner earnings ÷ revenue | 35% | 33% | 27% | 20% | 20% |
Owner earnings is the cash an owner could pull out without starving the business: operating cash less the capital it must spend to hold its position . The cash-flow statement also adds stock comp back as non-cash, but it is a real cost paid in shares; counted as the expense it is (less $3.5B), owner earnings is nearer $10.9B.
Maintenance capex is estimated as depreciation where a growing business invests above it; free cash flow is the figure the scorecard's free-cash margin reads.
Quality & stewardship
Returns, the balance sheet, capital allocation, and pay.
Owner’s Scorecard
FY2026 10-K · source on SEC EDGAR →
Will it survive?
- Can it pay its interest? 54.1×ComfortableOperating income $8.3B ÷ interest expense $154M
What this means
Operating profit covers interest with the kind of margin Graham wanted for a defensive holding. Necessary, not sufficient, it says solvent, not cheap.
- How heavy is the debt, net of cash? $6.9B · 0.8× operating profitModest net debtCash $7.3B + ST investments $183M − debt $14.4B
What this means
Netting $7.5B of cash and short-term investments against $14.4B of debt leaves $6.9B owed, about 0.8× a year's operating profit (1.7× on the gross debt, before the cash). It also holds $1.4B in longer-dated marketable securities; counting those, it sits at $5.5B of net debt. Net debt is the leverage figure that matters: the cash is already set against the debt. Strategic or illiquid investments aren't counted here.
- Long (60+ days)DSO 126 + DIO 0 − DPO 6 days
What this means
Days cash is tied up between paying suppliers and collecting from customers. Lower is better; a long cycle means growth itself eats cash. (Little or no inventory, a services / asset-light model, so the inventory leg is ~0.)
Is it a good business?
- Below average through the cycle10-yr median, range 0%–10%; 10% latest = NOPAT $6.5B ÷ invested capital $66.3BIndustry peers: median 18%
What this means
The rate the business earns on the money tied up in it, Buffett's north star, because over time a stock tracks the ROIC beneath it. Above ~15% sustained hints at a moat; a return below the cost of capital (~8%) erodes value as a business grows rather than building it — the test Buffett weighs most. The headline is the median of the last 10 years (it ran 10% most recently), so one peak or trough year doesn't set the verdict. Asset-light businesses (R&D expensed, little capital) read artificially high, pair this with Owner Earnings.
- High through the cycle10-yr median margin, range 19%–35%; latest $14.4B = operating cash $15.0B − maintenance capex $594MIndustry peers: median 19%
What this means
What an owner could take out without starving the business: operating cash less the maintenance capital it must spend to hold its position — Buffett's owner earnings. That's 35% of revenue this year, a 22% median across 10 years. Treating stock comp as the real expense it is (less $3.5B of SBC) leaves $10.9B.
- Cash-backedCash from ops $15.0B ÷ net income $7.5B
What this means
How much of reported profit showed up as operating cash. Above 1× is reassuring; well below suggests earnings lean on accruals. One year is noisy, growth and working-capital swings distort it, and this is operating cash, not free cash. Watch the multi-year trend.
How is the cash used?
- Returns most of itDividends + buybacks $14.2B ÷ Owner Earnings $14.4B
What this means
Of $14.4B Owner Earnings, $14.2B (98%) went back to shareholders, $1.6B dividends, $12.6B buybacks. Net of $3.5B stock comp, the real buyback was about $9.1B. Returning most of it is the mark of a mature business with little left to reinvest at a high return; reinvesting most could mean a long runway, or empire-building. The split doesn't say which; the return earned on it (see ROIC) does.
- Investing or harvesting? 0.49×HarvestingCapex $594M ÷ depreciation $1.2B
What this means
Descriptive, not a grade. Above ~1× means investing faster than assets wear out (growth, or, sustained for years, today's earnings carrying less depreciation than tomorrow's will). Below means spending less than it's wearing out (efficiency, or a melting asset base). The ratio won't tell you which; the filings will.
Graham’s defensive tests · 3 of 6 met
Graham’s numerical criteria for the defensive investor (The Intelligent Investor, ch. 14), run on the filings. A floor of safety, not a buy signal; many fine modern businesses fail his strictest liquidity rules by design.
- Adequate size PassRevenue ≥ $2B · $41.5B
What this means
Big enough to weather a storm. Graham's 1972 floor was ~$100M of sales (≈ $700M today); we use a $2B revenue line as a conservative modern stand-in.
- Strong liquidity MissCurrent ratio ≥ 2× · 0.76×
What this means
Current assets at least twice current liabilities, near-term bills covered without touching the business. Strict by design: many cash-rich modern firms run leaner and miss it, holding their cushion in longer-dated securities.
- Conservative debt MissDebt ≤ working capital · $14.4B vs ($8.9B) WC
What this means
Graham's rule that borrowings not exceed net current assets. Capital-heavy and buyback-heavy firms routinely fail it, read it next to interest coverage, not alone.
- Earnings stability PassA profit every year (10-yr record) · no losses
What this means
Graham wanted earnings in each of the past ten years, the stability a defensive owner leans on.
- Dividend record MissUninterrupted dividends · 2 of 10 yrs
What this means
An unbroken dividend was Graham's mark of durability. He wanted twenty years; the filings show about ten, and a single suspension breaks the streak. Non-payers, many fine modern compounders, fall outside his defensive net by design.
- Earnings growth PassEarnings +33% over the record · +892%
What this means
At least a third more earnings than a decade ago, averaging three years at each end. Net income (not per-share), so stock splits don't distort it, buybacks and dilution show up in the share-count line instead.
- Moderate price —P/E ≤ 15 and P/E × P/B ≤ 22.5 · decided by the price
What this means
Graham's valuation gate, the wall he kept between a sound business and a sound investment. Three-year average earnings are $7.24/share (latest year $9.11), the averaged base the calculator's gate runs on, and book value is $72.21/share. Enter a price in “What the price implies” just below for the P/E, P/B, and whether it clears. But this is the rule Buffett outgrew: there's no hard P/E law, and a wonderful business can deserve a far richer multiple if the thesis holds, treat it as the bargain-hunter's floor, not a verdict on the price.
Durability & moat, 2017–2026
Whether the record’s returns held, and what the capital reinvested earned.
- Profitable years 10 of 10
What this means
Never lost money over the record, the earnings stability Graham insisted on.
- Return on capital ≥ 15% 0 of 10 yrs
What this means
A moat shows up as a high return on invested capital that holds year after year, not one good vintage.
- Operating margin 4% → 18% (3-yr avg ends)
What this means
Through the cycle the operating margin widened — about 4% early to 18% lately, median 3% — pricing power intact or improving.
- Reinvestment, incremental ROIC 10%
What this means
Reinvested capital came back at only a modest incremental return — near the cost of capital, where extra growth adds little per dollar. The record shows whether it is a soft stretch or a thinning moat.
- Owner earnings growth +23%/yr
What this means
Owner earnings grew about 23% a year over the record.
- Worst year 2020 · 1.7% op. margin
What this means
Stayed profitable even in its hardest year, the resilience that survives recessions.
- Share count +3.5%/yr
What this means
The share count is rising, dilution works against you on a per-share basis.
- Dividend record paid
What this means
Paid a dividend in 2 of the years on record.
Does AI threaten the moat?
Elevated contestabilityThe product is software or information, the very thing capable AI now produces more cheaply, so the moat is more contestable than the record alone implies.
In its own filing Named as a competitive risk
Its FY2026 10-K names artificial intelligence as a competitive threat.
“Additionally, as we continue to increasingly build AI into many of our offerings, we face more competition as AI technologies are increasingly integrated into the markets in which we compete.”
AI has collapsed the cost of building a capable substitute for the very thing this business sells. When a credible alternative can be assembled for a fraction of the incumbent's price, it is pricing power that erodes first, not revenue tomorrow. The live question is whether the moat survives that, not whether it held in the past. Whether that question is answerable at all is yours to decide, against your own circle of competence.
Read from the filing's own risk factors, paired with the industry's structure under its SIC code; the durability is read above, the price below.
All figures as filed; the source filing is linked above.
Current Position
as of the latest quarter, Apr 30, 2026Can the business pay what it owes this year, off the freshest balance sheet: the quality of the assets, the debt actually coming due, and what a low ratio means here.
Current assets$21.6B
- Cash & short-term investments$9.0B
- Receivables$5.1B
- Other current assets$7.5B
Current liabilities$27.5B
- Accounts payable$165M
- Other current liabilities$27.3B
Current ratio0.79×all current assets ÷ what's due · Graham looked for 2×
Quick ratio0.79×stricter: inventory excluded
Cash ratio0.33×strictest: cash alone against what's due
Working capital($5.9B)the cushion left after near-term bills
Its current ratio is below 1, which usually reads as strain; here it is likely structural strength. What it owes in the near term is money to suppliers and customers (payables and deferred revenue), not to lenders, so the balance sheet is funded by operating float, the way Costco's and Amazon's are. The low ratio can be the edge, not the risk; the cash-conversion cycle and the debt due above say which.
Revenue, latest quarter vs. a year ago+13.3%the freshest read on whether the business is still growing
Current ratio, recent quarters1.0× → 0.8×
Deeper floors
Tangible book value($31.7B)equity stripped of goodwill & intangibles
Net current asset value($50.8B)Graham's net-net: current assets less all liabilities
Debt incl. operating leases$41.9B$2.6B of it operating leases; with finance leases, “total fixed claims” below reaches $17.7B (annual-report basis)
Deferred revenue$20.4Bcustomer cash collected before delivery; operating float
From the company's latest filing.
Debt maturity
the debt note, SEC EDGAR →Not how much it owes, but when it falls due, and against what. The ladder the company files, beside cash on hand and a year's owner earnings.
Bars scaled to the largest single year; “later” is everything due after 2031, shown apart since it dwarfs the years.
Due in the next 12 months$4.0Bthe first rung: what must be repaid or rolled over within the year
Within two years$4.0Bthe near wall, the part most exposed to today’s credit conditions
Biggest single year$4.5Bin 2029the lumpiest maturity, where a refinancing, if needed, is largest
Total scheduled principal$14.5Bevery year plus what lies beyond, as the footnote totals it
Against what the business has and earns
Cash & short-term investments, Apr 30, 2026$9.0B
One year of owner earnings (FY2026)$14.4B
Together, against $4.0B due next year5.8×
Cash on hand as of Apr 30, 2026 plus a year’s owner earnings comes to $23.4B against the $4.0B due in the twelve months after the Jan 31, 2026 schedule: 5.8 times it.
Maturity schedule extracted from the company’s Jan 31, 2026 annual report and reconciled to the total the table states.
Lease obligations
the lease note, SEC EDGAR →Debt by another name. What the business owes on the property, aircraft, stores and equipment it rents rather than owns is a fixed claim due on a schedule; added back to the debt, it is the true leverage. That ladder, operating and finance leases together, and what it adds to the debt on the page above.
Operating leasesFinance leases
Lease payments by year, scaled to the largest; “later” is everything beyond year five, shown apart. These are the contractual cash payments, before the interest the filing imputes back out to the balance-sheet liability.
Due in the next 12 months$904Ma fixed cash payment, owed whether or not the business has a good year
Total lease payments$3.6Bevery year plus the tail, undiscounted: the full cash the leases will take
On the balance sheet$3.3Bthe present value of those payments, the recognised lease liability
True leverage: debt plus leases
On-balance-sheet debt$14.4B
Lease obligations (present value)$3.3B
Total fixed claims on the business$17.7B
Counting the leases the way Buffett does, the fixed claims on this business come to $17.7B, of which the leases are 18%. The lease wall above and the debt schedule together are the calendar of what must be paid, and when.
Lease ladder read from the ASC 842 tags in the company’s Jan 31, 2026 annual report and reconciled: the yearly buckets sum to the undiscounted total, which less the imputed interest equals the balance-sheet liability; a ladder that doesn’t tie out is withheld.
How the cash was used, 2017–2026
Over the record, the business generated $68.9B of operating cash; how management split it reads as a balanced allocator, splitting cash between the business, owners, and the balance sheet.
- Reinvested$6.4B · 9%
- Dividends$3.1B · 5%
- Buybacks$32.0B · 47%
- Retained (debt / cash)$27.2B · 40%
- Returned to owners$35.2B
56% of the owner earnings the business produced over the span, $3.1B as dividends and $32.0B as buybacks.
- Source of fundingOperating cash
Operating cash covered reinvestment and returns; over the span debt rose $37.3B and cash and short-term investments rose $7.4B.
- Average price paid for buybacks—
Buybacks ran $32.0B over the span, but the filings don't tag the share count needed to deduce the average price paid.
- Net change in share count24.4%
The diluted count rose from 700M to 871M: issuance (stock pay, deals) outran any buybacks, so owners were diluted on net.
- Dividend record$1.66/sh
Paid in 2 of the years on record. It was never cut over the span.
Buybacks are gross of stock issued to staff; the share-count line above is the net of that, the figure that decides whether owners gained. The average price paid blends a year of purchases (and any accelerated repurchase), so it is close, not exact. The record of where the cash went and on what terms.
Acquisitions & goodwill
from the balance sheet & the 10-year cash-flow recordGoodwill grows only when a company acquires and falls only when it concedes it overpaid. The size of that bet, the cash put into buying rather than building, and how much has already been written off.
Goodwill & intangibles$64.8B58% of all assets; the premium carried on the balance sheet for businesses acquired
Against book equity98%goodwill is this share of book equity; the rest is the company’s own retained and paid-in capital
Cash spent acquiring$37.4Bover 10 years buying other businesses, against $6.4B of capital spent building
None written down over the record; the goodwill is still carried at full cost. That is the deals holding their value on the books so far; whether they keep doing so is the test an owner watches, since the write-down, when it comes, is the admission the price was too high.
Goodwill, acquired intangibles and equity from the latest balance sheet; acquisition spend and write-downs summed across the 10-year record, from the company's own filings.
Management, ownership & pay
read the proxy →From the proxy: how much of the business the people running it own, and how they are paid, beside what the business earned for its owners in the same years.
| Fiscal year | Chief executive | Pay, as filed | “Actually paid” | Owner earnings |
|---|---|---|---|---|
| 2022 | Marc Benioff | $28.6M | $25.1M | $5.3B |
| 2022 | Marc Benioff | $22.8M | $31.5M | $5.3B |
| 2023 | Marc Benioff | $29.9M | −$15.6M | $6.3B |
| 2023 | Marc Benioff | $26.8M | −$72.2M | $6.3B |
| 2024 | Marc Benioff | $39.6M | $100.6M | $9.5B |
| 2025 | Marc Benioff | $55.1M | $87.1M | $12.4B |
| 2026 | Marc Benioff | $49.4M | −$49.2M | $14.4B |
| 2026 | Marc Benioff | $49.4M | −$49.2M | $14.4B |
Both pay figures are the company’s own, from the pay-versus-performance table its proxy statement files. “As filed” is the Summary Compensation Table total: salary, bonus, and equity awards at their value on the day of grant. “Actually paid” is the SEC’s prescribed recalculation, which re-marks those equity awards to what they became as they vested; it can swing far above or below the filed figure in either direction, and negative years occur. Owner earnings are the whole business's, from the record above, for the same fiscal years.
- Insider ownership<1%
The stake all directors and executive officers hold together, per the 2026 proxy: skin in the game, the first thing Munger reads.
- Stock-based compensation$3.5B
The slice of the business handed to employees in shares this year, 8% of revenue, equal to 42% of operating profit. Buffett's oldest accounting fight: this is compensation, compensation is an expense, real whether or not the headline earnings admit it. One trap: the cash-flow statement adds SBC back, so the operating cash, and the owner earnings drawn from it, are flattered by exactly this amount; counted as the cost it is, what an owner keeps is lower.
Inverting the record
Invert: instead of why Salesforce Inc. is a good business, the question is what would make owning it a mistake, and whether those marks are in the record. Disconfirming tests across 2017–2026.
2 of the 5 tests turned up something to look into; the other 3 came back clean.
- Look hereDid the share count rise anyway?24.4%
Diluted shares grew 24.4% over 2017–2026, even as the company spent $32.0B on buybacks. The repurchases were outrun by issuance — to staff, in a raise, or in a deal — and the filing says which; owners' slice still shrank. Read the buyback line beside this one, not on its own.
- Look hereDid debt outgrow the business?$2.0B → $39.3B
Debt rose from $2.0B to $39.3B while owner earnings went from about $2.4B to $12.1B — about 0.9 years of owner earnings in debt then, about 3.2 now: measured against what the business earns, the balance sheet carries more debt than it did. Debt raised for buybacks or deals rather than growth is the kind that bites in a downturn.
And these came back clean
- Is it less profitable than it was?
- Did reported profit become cash?
- Did receivables and inventory outpace sales?
Each test is read from the filings and is noisy alone; a flag can mark a cyclical trough or a year of heavy investment as easily as a problem. The filing says which.
What an owner would ask, FY2026
read the 10-K →- Which reported numbers are a judgment call?Management names Revenue recognition, Income taxes, Acquisitions, Stock compensation as critical estimates
each rests partly on management's judgment; the filing's note sets out the assumptionsverify →
The questions the record and the charts do not answer on their own; each carries the figure and the place to look.
Peers, Software
The same industry, side by side on owner economics. Each figure is a through-cycle median, so a peak or trough year can’t distort it; the group median at the foot is the line to read each against.
| Company | Revenue | Gross margin | Op. margin | ROIC | Owner earn. margin |
|---|---|---|---|---|---|
| CRMSalesforce Inc. | $41.5B | 74% | 3.7% | 3% | 22% |
| XYZBlock Inc. | $24.2B | 34% | -0.7% | -1% | 4% |
| ADBEAdobe Inc. | $23.8B | 87% | 32.2% | 33% | 39% |
| CTSHCognizant | $21.1B | — | 15.3% | 18% | 12% |
| ADPAutomatic Data Processing Inc. | $20.6B | 43% | 21.3% | 46% | 19% |
| INTUIntuit Inc. | $18.8B | 99% | 26.0% | 35% | 32% |
| NOWServiceNow Inc. | $13.3B | 77% | 4.4% | 6% | 30% |
| SHOPShopify Inc. | $11.6B | 49% | -1.3% | -0% | 15% |
| Group median | — | 74% | 9.8% | 12% | 21% |
The price
What a price has to assume.
What the price implies
reverse-DCFType today's close and see the owner-earnings growth you'd have to believe to justify it, beside what Salesforce Inc. has delivered.
Salesforce Inc.’s latest year runs above its own through-cycle margin — the reported figure may flatter a peak. So the tool opens on the through-cycle base, Graham’s averaging cutting both ways; clear the toggle below to read the latest year exactly as reported.
$
Through the cycle, Salesforce Inc. earns about $9.3B on its 22.5% median owner-earnings margin. This year’s 34.7% margin runs above that; the reported figure may flatter a peak you'd be paying on. Normalize, below, values the price on that through-cycle figure rather than the latest year. It comes pre-checked here for that reason, the same rule that already normalizes a trough; clear it to price the year as filed.
Base
—
The assumptions
9.0% = the 4.55% 10-year Treasury (Jul 15, 2026) + 4.45 points of equity premium. The rate you require is yours to set.
Enter a price above to run it.
A dated snapshot of the price you typed, the assumptions you set, and what the page showed for them. A snapshot is never edited after it is saved. Your notebook is yours alone — the commitment states what is stored and what we will never do.
Implied by the price—
Owner-earnings growth · ’22→’26+23%/yr
Owner-earnings growth · ’17→’26+24%/yr
Owner-earnings growth · ’17→’26+23%/yr
Owner-earnings yield—
What a growth belief costs, in multiples
The growth each return requires, at your price
P/E (3-yr earnings ’24–’26)—
P/B—
Graham’s price gate—
Graham capped the multiple at 15×; Buffett and Munger let that rule go: a wonderful business can deserve 50× if the thesis holds. The gate marks the bargain-hunter's floor.
Against a high-grade bond: Graham’s yardstick bond yield%
Prefilled with the 10-year Treasury (4.55%, as of Jul 15, 2026). Edit it for today’s exact figure, or a AAA corporate yield.
Graham measured a stock against the bond you could own instead, the heart of his margin of safety. Enter a price above to weigh the owner-earnings yield against this bond.
Owner-earnings yield—
High-grade bond yield—
Margin over the bond—
Owner earnings $14.7B on 819M shares outstanding, per the 10-Q cover, as of 2026-05-21; net debt $29.7B. The if-converted diluted count is 871M, 6% above the shares outstanding: the dilution overhang (convertibles, options) a buyer inherits. The base opens on the through-cycle figure (the latest year sits above the record’s own median, and Graham’s averaging cuts both ways); clear Normalize to use the year as filed. Net of stock comp treats option pay as the expense it is. The dials set the multiple a growth belief justifies; the price, and every dollar on this page, is yours.
Notes
- Jul 16, 2026 The Moat and the Multiple
Cite: Owner Scorecard, "Salesforce Inc. (CRM), the owner's record," https://ownerscorecard.com/c/CRM, data as of 2026-07-09.
Manual order: ← CRL its page in the Manual CRMD →
Industry order: ← COUR the Software chapter CRNC →