|
|
x
|
Quarterly report pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934
|
¨
|
Transition report pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934
|
|
|
Delaware
|
94-3320693
|
(State or other jurisdiction of
incorporation or organization)
|
(IRS Employer
Identification No.)
|
Securities registered pursuant to Section 12(b) of the Act
|
||
Title of each class
|
Trading Symbol(s)
|
Name of each exchange on which registered
|
Common Stock, par value $0.001 per share
|
CRM
|
New York Stock Exchange, Inc.
|
Large accelerated filer x
|
Accelerated filer
|
¨
|
|
|
|
Non-accelerated filer ¨
|
Smaller reporting company
|
¨
|
|
|
|
|
Emerging growth company
|
¨
|
|
|
Page No.
|
|
|
|
|
|
|
Item 1.
|
|
|
|
|
|
|
||
|
|
|
|
||
|
|
|
|
||
|
|
|
|
||
|
|
|
|
||
|
|
|
|
||
|
|
|
Item 2.
|
||
|
|
|
Item 3.
|
||
|
|
|
Item 4.
|
||
|
|
|
|
|
|
|
|
|
Item 1.
|
||
|
|
|
Item 1A.
|
||
|
|
|
Item 2.
|
||
|
|
|
Item 3.
|
||
|
|
|
Item 4.
|
||
|
|
|
Item 5.
|
||
|
|
|
Item 6.
|
ITEM 1.
|
FINANCIAL STATEMENTS
|
|
April 30, 2019
|
|
January 31, 2019
|
||||
Assets
|
|
|
|
||||
Current assets:
|
|
|
|
||||
Cash and cash equivalents
|
$
|
4,110
|
|
|
$
|
2,669
|
|
Marketable securities
|
2,269
|
|
|
1,673
|
|
||
Accounts receivable
|
2,153
|
|
|
4,924
|
|
||
Costs capitalized to obtain revenue contracts, net
|
786
|
|
|
788
|
|
||
Prepaid expenses and other current assets
|
717
|
|
|
629
|
|
||
Total current assets
|
10,035
|
|
|
10,683
|
|
||
Property and equipment, net
|
2,243
|
|
|
2,051
|
|
||
Operating lease right-of-use assets
|
2,854
|
|
|
0
|
|
||
Costs capitalized to obtain revenue contracts, noncurrent, net
|
1,149
|
|
|
1,232
|
|
||
Strategic investments
|
1,548
|
|
|
1,302
|
|
||
Goodwill
|
12,854
|
|
|
12,851
|
|
||
Intangible assets acquired through business combinations, net
|
1,794
|
|
|
1,923
|
|
||
Capitalized software and other assets, net
|
677
|
|
|
695
|
|
||
Total assets
|
$
|
33,154
|
|
|
$
|
30,737
|
|
Liabilities and stockholders’ equity
|
|
|
|
||||
Current liabilities:
|
|
|
|
||||
Accounts payable, accrued expenses and other liabilities
|
$
|
2,228
|
|
|
$
|
2,691
|
|
Operating lease liabilities, current
|
675
|
|
|
0
|
|
||
Unearned revenue
|
7,585
|
|
|
8,564
|
|
||
Total current liabilities
|
10,488
|
|
|
11,255
|
|
||
Noncurrent debt
|
3,173
|
|
|
3,173
|
|
||
Noncurrent operating lease liabilities
|
2,383
|
|
|
0
|
|
||
Other noncurrent liabilities
|
664
|
|
|
704
|
|
||
Total liabilities
|
16,708
|
|
|
15,132
|
|
||
Stockholders’ equity:
|
|
|
|
||||
Common stock
|
1
|
|
|
1
|
|
||
Additional paid-in capital
|
14,383
|
|
|
13,927
|
|
||
Accumulated other comprehensive loss
|
(65
|
)
|
|
(58
|
)
|
||
Retained earnings
|
2,127
|
|
|
1,735
|
|
||
Total stockholders’ equity
|
16,446
|
|
|
15,605
|
|
||
Total liabilities and stockholders’ equity
|
$
|
33,154
|
|
|
$
|
30,737
|
|
1
|
Three Months Ended April 30,
|
||||||
|
2019
|
|
2018
|
||||
Revenues:
|
|
|
|
||||
Subscription and support
|
$
|
3,496
|
|
|
$
|
2,810
|
|
Professional services and other
|
241
|
|
|
196
|
|
||
Total revenues
|
3,737
|
|
|
3,006
|
|
||
Cost of revenues (1)(2):
|
|
|
|
||||
Subscription and support
|
678
|
|
|
573
|
|
||
Professional services and other
|
236
|
|
|
194
|
|
||
Total cost of revenues
|
914
|
|
|
767
|
|
||
Gross profit
|
2,823
|
|
|
2,239
|
|
||
Operating expenses (1)(2):
|
|
|
|
||||
Research and development
|
554
|
|
|
424
|
|
||
Marketing and sales
|
1,697
|
|
|
1,329
|
|
||
General and administrative
|
362
|
|
|
295
|
|
||
Total operating expenses
|
2,613
|
|
|
2,048
|
|
||
Income from operations
|
210
|
|
|
191
|
|
||
Gains on strategic investments, net
|
281
|
|
|
211
|
|
||
Other expense
|
(9
|
)
|
|
(17
|
)
|
||
Income before provision for income taxes
|
482
|
|
|
385
|
|
||
Provision for income taxes
|
(90
|
)
|
|
(41
|
)
|
||
Net income
|
$
|
392
|
|
|
$
|
344
|
|
Basic net income per share
|
$
|
0.51
|
|
|
$
|
0.47
|
|
Diluted net income per share
|
$
|
0.49
|
|
|
$
|
0.46
|
|
Shares used in computing basic net income per share
|
771
|
|
|
729
|
|
||
Shares used in computing diluted net income per share
|
793
|
|
|
754
|
|
(1)
|
Amounts include amortization of intangible assets acquired through business combinations, as follows:
|
|
Three Months Ended April 30,
|
||||||
|
2019
|
|
2018
|
||||
Cost of revenues
|
$
|
61
|
|
|
$
|
39
|
|
Marketing and sales
|
68
|
|
|
30
|
|
(2)
|
Amounts include stock-based expense, as follows:
|
|
Three Months Ended April 30,
|
||||||
|
2019
|
|
2018
|
||||
Cost of revenues
|
$
|
43
|
|
|
$
|
34
|
|
Research and development
|
81
|
|
|
66
|
|
||
Marketing and sales
|
177
|
|
|
120
|
|
||
General and administrative
|
42
|
|
|
32
|
|
1
|
Three Months Ended April 30,
|
||||||
|
2019
|
|
2018
|
||||
Net income
|
$
|
392
|
|
|
$
|
344
|
|
Other comprehensive loss, net of reclassification adjustments:
|
|
|
|
||||
Foreign currency translation and other losses
|
(13
|
)
|
|
(10
|
)
|
||
Unrealized gains (losses) on marketable securities and strategic investments
|
8
|
|
|
(4
|
)
|
||
Other comprehensive loss, before tax
|
(5
|
)
|
|
(14
|
)
|
||
Tax effect
|
(2
|
)
|
|
0
|
|
||
Other comprehensive loss, net
|
(7
|
)
|
|
(14
|
)
|
||
Comprehensive income
|
$
|
385
|
|
|
$
|
330
|
|
|
Three Months Ended April 30, 2018
|
|||||||||||||||||||||
|
Common Stock
|
|
Additional
Paid-in
Capital
|
|
Accumulated Other Comprehensive Loss
|
|
Retained Earnings
|
|
Total
Stockholders’
Equity
|
|||||||||||||
|
Shares
|
|
Amount
|
|
||||||||||||||||||
Balance at January 31, 2018
|
730
|
|
|
$
|
1
|
|
|
$
|
9,752
|
|
|
$
|
(12
|
)
|
|
$
|
635
|
|
|
$
|
10,376
|
|
Cumulative effect of accounting changes
|
0
|
|
|
0
|
|
|
0
|
|
|
(7
|
)
|
|
(10
|
)
|
|
(17
|
)
|
|||||
Common stock issued
|
4
|
|
|
0
|
|
|
115
|
|
|
0
|
|
|
0
|
|
|
115
|
|
|||||
Settlement of convertible notes and warrants
|
0
|
|
|
0
|
|
|
4
|
|
|
0
|
|
|
0
|
|
|
4
|
|
|||||
Stock-based expenses
|
0
|
|
|
0
|
|
|
252
|
|
|
0
|
|
|
0
|
|
|
252
|
|
|||||
Other comprehensive loss, net of tax
|
0
|
|
|
0
|
|
|
0
|
|
|
(14
|
)
|
|
0
|
|
|
(14
|
)
|
|||||
Net income
|
0
|
|
|
0
|
|
|
0
|
|
|
0
|
|
|
344
|
|
|
344
|
|
|||||
Balance at April 30, 2018
|
734
|
|
|
$
|
1
|
|
|
$
|
10,123
|
|
|
$
|
(33
|
)
|
|
$
|
969
|
|
|
$
|
11,060
|
|
|
Three Months Ended April 30, 2019
|
|||||||||||||||||||||
|
Common Stock
|
|
Additional
Paid-in
Capital
|
|
Accumulated Other Comprehensive Loss
|
|
Retained Earnings
|
|
Total
Stockholders’
Equity
|
|||||||||||||
|
Shares
|
|
Amount
|
|
||||||||||||||||||
Balance at January 31, 2019
|
770
|
|
|
$
|
1
|
|
|
$
|
13,927
|
|
|
$
|
(58
|
)
|
|
$
|
1,735
|
|
|
$
|
15,605
|
|
Common stock issued
|
5
|
|
|
0
|
|
|
113
|
|
|
0
|
|
|
0
|
|
|
113
|
|
|||||
Stock-based expenses
|
0
|
|
|
0
|
|
|
343
|
|
|
0
|
|
|
0
|
|
|
343
|
|
|||||
Other comprehensive loss, net of tax
|
0
|
|
|
0
|
|
|
0
|
|
|
(7
|
)
|
|
0
|
|
|
(7
|
)
|
|||||
Net income
|
0
|
|
|
0
|
|
|
0
|
|
|
0
|
|
|
392
|
|
|
392
|
|
|||||
Balance at April 30, 2019
|
775
|
|
|
$
|
1
|
|
|
$
|
14,383
|
|
|
$
|
(65
|
)
|
|
$
|
2,127
|
|
|
$
|
16,446
|
|
1
|
Three Months Ended April 30,
|
||||||
|
2019
|
|
2018
|
||||
Operating activities:
|
|
|
|
||||
Net income
|
$
|
392
|
|
|
$
|
344
|
|
Adjustments to reconcile net income to net cash provided by operating activities:
|
|
|
|
||||
Depreciation and amortization
|
437
|
|
|
197
|
|
||
Amortization of costs capitalized to obtain revenue contracts, net
|
209
|
|
|
188
|
|
||
Expenses related to employee stock plans
|
343
|
|
|
252
|
|
||
Gains on strategic investments, net
|
(281
|
)
|
|
(211
|
)
|
||
Changes in assets and liabilities, net of business combinations:
|
|
|
|
||||
Accounts receivable, net
|
2,774
|
|
|
2,162
|
|
||
Costs capitalized to obtain revenue contracts, net
|
(124
|
)
|
|
(118
|
)
|
||
Prepaid expenses and other current assets and other assets
|
(97
|
)
|
|
(90
|
)
|
||
Accounts payable
|
15
|
|
|
50
|
|
||
Accrued expenses and other liabilities
|
(560
|
)
|
|
(506
|
)
|
||
Operating lease liabilities
|
(164
|
)
|
|
0
|
|
||
Unearned revenue
|
(979
|
)
|
|
(802
|
)
|
||
Net cash provided by operating activities
|
1,965
|
|
|
1,466
|
|
||
Investing activities:
|
|
|
|
||||
Business combinations, net of cash acquired
|
(10
|
)
|
|
(182
|
)
|
||
Purchases of strategic investments
|
(159
|
)
|
|
(147
|
)
|
||
Sales of strategic investments
|
194
|
|
|
4
|
|
||
Purchases of marketable securities
|
(734
|
)
|
|
(263
|
)
|
||
Sales of marketable securities
|
86
|
|
|
938
|
|
||
Maturities of marketable securities
|
56
|
|
|
48
|
|
||
Capital expenditures
|
(159
|
)
|
|
(122
|
)
|
||
Net cash provided by (used in) investing activities
|
(726
|
)
|
|
276
|
|
||
Financing activities:
|
|
|
|
||||
Proceeds from issuance of debt, net
|
0
|
|
|
2,470
|
|
||
Proceeds from employee stock plans
|
219
|
|
|
201
|
|
||
Principal payments on financing obligations (1)
|
(11
|
)
|
|
(19
|
)
|
||
Repayments of debt
|
(1
|
)
|
|
(1,027
|
)
|
||
Net cash provided by financing activities
|
207
|
|
|
1,625
|
|
||
Effect of exchange rate changes
|
(5
|
)
|
|
12
|
|
||
Net increase in cash and cash equivalents
|
1,441
|
|
|
3,379
|
|
||
Cash and cash equivalents, beginning of period
|
2,669
|
|
|
2,543
|
|
||
Cash and cash equivalents, end of period
|
$
|
4,110
|
|
|
$
|
5,922
|
|
|
Three Months Ended April 30,
|
||||||
|
2019
|
|
2018
|
||||
Supplemental cash flow disclosure:
|
|
|
|
||||
Cash paid during the period for:
|
|
|
|
||||
Interest
|
$
|
50
|
|
|
$
|
7
|
|
Income taxes, net of tax refunds
|
$
|
18
|
|
|
$
|
19
|
|
•
|
the standalone selling price (SSP) of performance obligations for revenue contracts with multiple performance obligations;
|
•
|
the fair value of assets acquired and liabilities assumed for business combinations;
|
•
|
the recognition, measurement and valuation of current and deferred income taxes and uncertain tax positions;
|
•
|
the average period of benefit associated with costs capitalized to obtain revenue contracts;
|
•
|
the fair value of certain stock awards issued;
|
•
|
the useful lives of intangible assets; and
|
•
|
the valuation of privately-held strategic investments.
|
Computers, equipment and software
|
3 to 9 years
|
Furniture and fixtures
|
5 years
|
Leasehold improvements
|
Shorter of the estimated lease term or 10 years
|
Building and structural components
|
Average weighted useful life of 32 years
|
Building improvements
|
10 years
|
|
Three Months Ended April 30,
|
||||||
|
2019
|
|
2018
|
||||
Sales Cloud
|
$
|
1,073
|
|
|
$
|
965
|
|
Service Cloud
|
1,020
|
|
|
848
|
|
||
Salesforce Platform and Other
|
842
|
|
|
575
|
|
||
Marketing and Commerce Cloud
|
561
|
|
|
422
|
|
||
|
$
|
3,496
|
|
|
$
|
2,810
|
|
|
Three Months Ended April 30,
|
||||||
|
2019
|
|
2018
|
||||
Americas
|
$
|
2,617
|
|
|
$
|
2,101
|
|
Europe
|
755
|
|
|
606
|
|
||
Asia Pacific
|
365
|
|
|
299
|
|
||
|
$
|
3,737
|
|
|
$
|
3,006
|
|
|
Three Months Ended
April 30, 2019 |
|
Three Months Ended
April 30, 2018 |
||||
Unearned revenue, beginning of period
|
$
|
8,564
|
|
|
$
|
6,995
|
|
Billings and other*
|
2,714
|
|
|
2,211
|
|
||
Contribution from contract asset
|
44
|
|
|
(6
|
)
|
||
Revenue recognized ratably over time
|
(3,488
|
)
|
|
(2,868
|
)
|
||
Revenue recognized over time as delivered
|
(172
|
)
|
|
(137
|
)
|
||
Revenue recognized at a point in time
|
(77
|
)
|
|
(1
|
)
|
||
Unearned revenue from business combinations
|
0
|
|
|
7
|
|
||
Unearned revenue, end of period
|
$
|
7,585
|
|
|
$
|
6,201
|
|
|
Current
|
|
Noncurrent
|
|
Total
|
||||||
As of April 30, 2019
|
$
|
11.8
|
|
|
$
|
13.1
|
|
|
$
|
24.9
|
|
As of January 31, 2019
|
$
|
11.9
|
|
|
$
|
13.8
|
|
|
$
|
25.7
|
|
Investments classified as Marketable Securities
|
Amortized
Cost
|
|
Unrealized
Gains
|
|
Unrealized
Losses
|
|
Fair Value
|
||||||||
Corporate notes and obligations
|
$
|
1,368
|
|
|
$
|
0
|
|
|
$
|
(3
|
)
|
|
$
|
1,365
|
|
U.S. treasury securities
|
99
|
|
|
0
|
|
|
(1
|
)
|
|
98
|
|
||||
Mortgage backed obligations
|
77
|
|
|
0
|
|
|
(1
|
)
|
|
76
|
|
||||
Asset backed securities
|
454
|
|
|
0
|
|
|
(1
|
)
|
|
453
|
|
||||
Municipal securities
|
112
|
|
|
0
|
|
|
0
|
|
|
112
|
|
||||
Foreign government obligations
|
51
|
|
|
0
|
|
|
0
|
|
|
51
|
|
||||
U.S. agency obligations
|
10
|
|
|
0
|
|
|
0
|
|
|
10
|
|
||||
Commercial paper
|
21
|
|
|
0
|
|
|
0
|
|
|
21
|
|
||||
Time deposits
|
2
|
|
|
0
|
|
|
0
|
|
|
2
|
|
||||
Covered bonds
|
81
|
|
|
0
|
|
|
0
|
|
|
81
|
|
||||
Total marketable securities
|
$
|
2,275
|
|
|
$
|
0
|
|
|
$
|
(6
|
)
|
|
$
|
2,269
|
|
Investments classified as Marketable Securities
|
Amortized
Cost
|
|
Unrealized
Gains
|
|
Unrealized
Losses
|
|
Fair Value
|
||||||||
Corporate notes and obligations
|
$
|
1,027
|
|
|
$
|
0
|
|
|
$
|
(8
|
)
|
|
$
|
1,019
|
|
U.S. treasury securities
|
89
|
|
|
0
|
|
|
(1
|
)
|
|
88
|
|
||||
Mortgage backed obligations
|
79
|
|
|
0
|
|
|
(1
|
)
|
|
78
|
|
||||
Asset backed securities
|
245
|
|
|
0
|
|
|
(1
|
)
|
|
244
|
|
||||
Municipal securities
|
104
|
|
|
0
|
|
|
0
|
|
|
104
|
|
||||
Foreign government obligations
|
58
|
|
|
0
|
|
|
(1
|
)
|
|
57
|
|
||||
U.S. agency obligations
|
4
|
|
|
0
|
|
|
0
|
|
|
4
|
|
||||
Time deposits
|
4
|
|
|
0
|
|
|
0
|
|
|
4
|
|
||||
Covered bonds
|
75
|
|
|
0
|
|
|
0
|
|
|
75
|
|
||||
Total marketable securities
|
$
|
1,685
|
|
|
$
|
0
|
|
|
$
|
(12
|
)
|
|
$
|
1,673
|
|
|
As of
|
||||||
|
April 30,
2019 |
|
January 31,
2019 |
||||
Due within 1 year
|
$
|
878
|
|
|
$
|
482
|
|
Due in 1 year through 5 years
|
1,389
|
|
|
1,189
|
|
||
Due in 5 years through 10 years
|
2
|
|
|
2
|
|
||
|
$
|
2,269
|
|
|
$
|
1,673
|
|
|
Less than 12 Months
|
|
12 Months or Greater
|
|
Total
|
||||||||||||||||||
|
Fair Value
|
|
Unrealized
Losses
|
|
Fair Value
|
|
Unrealized
Losses
|
|
Fair Value
|
|
Unrealized
Losses
|
||||||||||||
Corporate notes and obligations
|
$
|
0
|
|
|
$
|
0
|
|
|
$
|
407
|
|
|
$
|
(3
|
)
|
|
$
|
407
|
|
|
$
|
(3
|
)
|
U.S. treasury securities
|
0
|
|
|
0
|
|
|
71
|
|
|
(1
|
)
|
|
71
|
|
|
(1
|
)
|
||||||
Mortgage backed obligations
|
0
|
|
|
0
|
|
|
47
|
|
|
(1
|
)
|
|
47
|
|
|
(1
|
)
|
||||||
Asset backed securities
|
0
|
|
|
0
|
|
|
106
|
|
|
(1
|
)
|
|
106
|
|
|
(1
|
)
|
||||||
|
$
|
0
|
|
|
$
|
0
|
|
|
$
|
631
|
|
|
$
|
(6
|
)
|
|
$
|
631
|
|
|
$
|
(6
|
)
|
|
Three Months Ended April 30,
|
||||||
|
2019
|
|
2018
|
||||
Interest income
|
$
|
26
|
|
|
$
|
20
|
|
Realized gains
|
0
|
|
|
1
|
|
||
Realized losses
|
0
|
|
|
(5
|
)
|
||
Investment income
|
$
|
26
|
|
|
$
|
16
|
|
|
Measurement Category
|
||||||||||||||
|
Fair Value (1)
|
|
Measurement Alternative
|
|
Other (2)
|
|
Total
|
||||||||
Equity securities
|
$
|
536
|
|
|
$
|
927
|
|
|
$
|
51
|
|
|
$
|
1,514
|
|
Debt securities
|
0
|
|
|
0
|
|
|
34
|
|
|
34
|
|
||||
Balance as of April 30, 2019
|
$
|
536
|
|
|
$
|
927
|
|
|
$
|
85
|
|
|
$
|
1,548
|
|
|
Measurement Category
|
||||||||||||||
|
Fair Value (1)
|
|
Measurement Alternative
|
|
Other (2)
|
|
Total
|
||||||||
Equity securities
|
$
|
436
|
|
|
$
|
785
|
|
|
$
|
50
|
|
|
$
|
1,271
|
|
Debt securities
|
0
|
|
|
0
|
|
|
31
|
|
|
31
|
|
||||
Balance as of January 31, 2019
|
$
|
436
|
|
|
$
|
785
|
|
|
$
|
81
|
|
|
$
|
1,302
|
|
|
Three months ended April 30, 2019
|
|
Three months ended April 30, 2018
|
||||
Carrying amount, beginning of period
|
$
|
785
|
|
|
$
|
548
|
|
Adjustments related to privately held equity securities:
|
|
|
|
||||
Net additions
|
20
|
|
|
11
|
|
||
Impairments and downward adjustments
|
(18
|
)
|
|
(18
|
)
|
||
Upward adjustments
|
140
|
|
|
13
|
|
||
Carrying amount, end of period
|
$
|
927
|
|
|
$
|
554
|
|
1
|
Three Months Ended April 30,
|
||||||
|
2019
|
|
2018
|
||||
Net gains recognized on publicly traded securities
|
$
|
150
|
|
|
$
|
211
|
|
Net gains (losses) recognized on privately held securities
|
122
|
|
|
(9
|
)
|
||
Net gains recognized on sales of equity securities
|
19
|
|
|
8
|
|
||
Net gains (losses) recognized on debt securities
|
(10
|
)
|
|
1
|
|
||
Gains on strategic investments, net
|
$
|
281
|
|
|
$
|
211
|
|
|
As of
|
||||||
|
April 30, 2019
|
|
January 31, 2019
|
||||
Notional amount of foreign currency derivative contracts
|
$
|
6,597
|
|
|
$
|
4,496
|
|
Fair value of foreign currency derivative contracts
|
(14
|
)
|
|
25
|
|
|
|
As of
|
||||||
|
Balance Sheet Location
|
April 30, 2019
|
|
January 31, 2019
|
||||
Foreign currency derivative contracts
|
Prepaid expenses and other current assets
|
$
|
29
|
|
|
$
|
42
|
|
|
Three Months Ended April 30,
|
||||||
|
2019
|
|
2018
|
||||
Foreign currency derivative contracts
|
$
|
22
|
|
|
$
|
20
|
|
Description
|
Quoted Prices in
Active Markets for Identical Assets (Level 1) |
|
Significant Other
Observable Inputs (Level 2) |
|
Significant
Unobservable Inputs (Level 3) |
|
Balance as of April 30, 2019
|
||||||||
Cash equivalents (1):
|
|
|
|
|
|
|
|
||||||||
Time deposits
|
$
|
0
|
|
|
$
|
817
|
|
|
$
|
0
|
|
|
$
|
817
|
|
Money market mutual funds
|
1,504
|
|
|
0
|
|
|
0
|
|
|
1,504
|
|
||||
Marketable securities:
|
|
|
|
|
|
|
|
||||||||
Corporate notes and obligations
|
0
|
|
|
1,365
|
|
|
0
|
|
|
1,365
|
|
||||
U.S. treasury securities
|
0
|
|
|
98
|
|
|
0
|
|
|
98
|
|
||||
Mortgage backed obligations
|
0
|
|
|
76
|
|
|
0
|
|
|
76
|
|
||||
Asset backed securities
|
0
|
|
|
453
|
|
|
0
|
|
|
453
|
|
||||
Municipal securities
|
0
|
|
|
112
|
|
|
0
|
|
|
112
|
|
||||
Foreign government obligations
|
0
|
|
|
51
|
|
|
0
|
|
|
51
|
|
||||
U.S. agency obligations
|
0
|
|
|
10
|
|
|
0
|
|
|
10
|
|
||||
Commercial paper
|
0
|
|
|
21
|
|
|
0
|
|
|
21
|
|
||||
Time deposits
|
0
|
|
|
2
|
|
|
0
|
|
|
2
|
|
||||
Covered bonds
|
0
|
|
|
81
|
|
|
0
|
|
|
81
|
|
||||
Strategic investments:
|
|
|
|
|
|
|
|
||||||||
Publicly held equity securities
|
536
|
|
|
0
|
|
|
0
|
|
|
536
|
|
||||
Foreign currency derivative contracts (2)
|
0
|
|
|
29
|
|
|
0
|
|
|
29
|
|
||||
Total assets
|
$
|
2,040
|
|
|
$
|
3,115
|
|
|
$
|
0
|
|
|
$
|
5,155
|
|
Description
|
Quoted Prices in
Active Markets
for Identical Assets
(Level 1)
|
|
Significant Other
Observable Inputs (Level 2)
|
|
Significant
Unobservable
Inputs
(Level 3)
|
|
Balance as of January 31, 2019
|
||||||||
Cash equivalents (1):
|
|
|
|
|
|
|
|
||||||||
Time deposits
|
$
|
0
|
|
|
$
|
314
|
|
|
$
|
0
|
|
|
$
|
314
|
|
Money market mutual funds
|
1,234
|
|
|
0
|
|
|
0
|
|
|
1,234
|
|
||||
Marketable securities:
|
|
|
|
|
|
|
|
||||||||
Corporate notes and obligations
|
0
|
|
|
1,019
|
|
|
0
|
|
|
1,019
|
|
||||
U.S. treasury securities
|
0
|
|
|
88
|
|
|
0
|
|
|
88
|
|
||||
Mortgage backed obligations
|
0
|
|
|
78
|
|
|
0
|
|
|
78
|
|
||||
Asset backed securities
|
0
|
|
|
244
|
|
|
0
|
|
|
244
|
|
||||
Municipal securities
|
0
|
|
|
104
|
|
|
0
|
|
|
104
|
|
||||
Foreign government obligations
|
0
|
|
|
57
|
|
|
0
|
|
|
57
|
|
||||
U.S. agency obligations
|
0
|
|
|
4
|
|
|
0
|
|
|
4
|
|
||||
Time deposits
|
0
|
|
|
4
|
|
|
0
|
|
|
4
|
|
||||
Covered bonds
|
0
|
|
|
75
|
|
|
0
|
|
|
75
|
|
||||
Strategic investments:
|
|
|
|
|
|
|
|
||||||||
Publicly held equity securities
|
436
|
|
|
0
|
|
|
0
|
|
|
436
|
|
||||
Foreign currency derivative contracts (2)
|
0
|
|
|
42
|
|
|
0
|
|
|
42
|
|
||||
Total assets
|
$
|
1,670
|
|
|
$
|
2,029
|
|
|
$
|
0
|
|
|
$
|
3,699
|
|
|
Intangible Assets, Gross
|
|
Accumulated Amortization
|
|
Intangible Assets, Net
|
|
Weighted
Average Remaining Useful Life (Years) |
||||||||||||||||||||||||||
|
Jan 31, 2019
|
|
Additions and retirements, net
|
|
April 30, 2019
|
|
Jan 31, 2019
|
|
Expense and retirements, net
|
|
April 30, 2019
|
|
Jan 31, 2019
|
|
April 30, 2019
|
|
|||||||||||||||||
Acquired developed technology
|
$
|
1,429
|
|
|
$
|
0
|
|
|
$
|
1,429
|
|
|
$
|
(889
|
)
|
|
$
|
(61
|
)
|
|
$
|
(950
|
)
|
|
$
|
540
|
|
|
$
|
479
|
|
|
2.7
|
Customer relationships
|
1,938
|
|
|
0
|
|
|
1,938
|
|
|
(560
|
)
|
|
(65
|
)
|
|
(625
|
)
|
|
1,378
|
|
|
1,313
|
|
|
6.1
|
||||||||
Other (1)
|
52
|
|
|
0
|
|
|
52
|
|
|
(47
|
)
|
|
(3
|
)
|
|
(50
|
)
|
|
5
|
|
|
2
|
|
|
5.9
|
||||||||
Total
|
$
|
3,419
|
|
|
$
|
0
|
|
|
$
|
3,419
|
|
|
$
|
(1,496
|
)
|
|
$
|
(129
|
)
|
|
$
|
(1,625
|
)
|
|
$
|
1,923
|
|
|
$
|
1,794
|
|
|
5.2
|
Fiscal Period:
|
|
||
Remaining nine months of Fiscal 2020
|
$
|
343
|
|
Fiscal 2021
|
414
|
|
|
Fiscal 2022
|
351
|
|
|
Fiscal 2023
|
211
|
|
|
Fiscal 2024
|
148
|
|
|
Thereafter
|
327
|
|
|
Total amortization expense
|
$
|
1,794
|
|
Balance as of January 31, 2019
|
$
|
12,851
|
|
Other acquisitions and adjustments (1)
|
3
|
|
|
Balance as of April 30, 2019
|
$
|
12,854
|
|
Instrument
|
|
Date of issuance
|
|
Maturity date
|
|
Effective interest rate for the three months ended April 30, 2019
|
|
April 30, 2019
|
|
January 31, 2019
|
||||
2021 Term Loan
|
|
May 2018
|
|
May 2021
|
|
3.37%
|
|
$
|
500
|
|
|
$
|
499
|
|
2023 Senior Notes
|
|
April 2018
|
|
April 2023
|
|
3.26%
|
|
993
|
|
|
993
|
|
||
2028 Senior Notes
|
|
April 2018
|
|
April 2028
|
|
3.70%
|
|
1,488
|
|
|
1,488
|
|
||
Loan assumed on 50 Fremont
|
|
February 2015
|
|
June 2023
|
|
3.75%
|
|
196
|
|
|
196
|
|
||
Total carrying value of debt
|
|
|
|
|
|
|
|
3,177
|
|
|
3,176
|
|
||
Less current portion of debt
|
|
|
|
|
|
|
|
(4
|
)
|
|
(3
|
)
|
||
Total noncurrent debt
|
|
|
|
|
|
|
|
$
|
3,173
|
|
|
$
|
3,173
|
|
Fiscal period:
|
|
||
Remaining nine months of Fiscal 2020
|
$
|
3
|
|
Fiscal 2021
|
4
|
|
|
Fiscal 2022
|
504
|
|
|
Fiscal 2023
|
4
|
|
|
Fiscal 2024
|
1,182
|
|
|
Thereafter
|
1,500
|
|
|
Total principal outstanding
|
$
|
3,197
|
|
|
Three Months Ended April 30,
|
||||||
|
2019
|
|
2018
|
||||
Contractual interest expense
|
$
|
28
|
|
|
$
|
11
|
|
Amortization of debt issuance costs
|
1
|
|
|
12
|
|
||
Amortization of debt discount
|
0
|
|
|
4
|
|
||
|
$
|
29
|
|
|
$
|
27
|
|
|
Options Outstanding
|
|||||||||
|
Outstanding
Stock
Options
(in millions)
|
|
Weighted-
Average
Exercise Price
|
|
Aggregate
Intrinsic Value (in millions)
|
|||||
Balance as of January 31, 2019
|
26
|
|
|
$
|
74.15
|
|
|
|
||
Options granted under all plans
|
5
|
|
|
161.44
|
|
|
|
|||
Exercised
|
(2
|
)
|
|
52.47
|
|
|
|
|||
Balance as of April 30, 2019
|
29
|
|
|
$
|
92.92
|
|
|
$
|
2,126
|
|
Vested or expected to vest
|
27
|
|
|
$
|
89.62
|
|
|
$
|
2,046
|
|
Exercisable as of April 30, 2019
|
13
|
|
|
$
|
63.88
|
|
|
$
|
1,354
|
|
|
|
Options Outstanding
|
|
Options Exercisable
|
||||||||||||
Range of Exercise
Prices |
|
Number
Outstanding
(in millions)
|
|
Weighted-
Average
Remaining
Contractual Life
(Years)
|
|
Weighted-
Average
Exercise
Price
|
|
Number of
Shares
(in millions)
|
|
Weighted-
Average
Exercise
Price
|
||||||
$0.27 to $52.30
|
|
5
|
|
|
4.5
|
|
$
|
29.30
|
|
|
4
|
|
|
$
|
32.78
|
|
$54.36 to $75.57
|
|
8
|
|
|
3.8
|
|
67.92
|
|
|
5
|
|
|
65.34
|
|
||
$76.48 to $113.00
|
|
4
|
|
|
4.0
|
|
84.47
|
|
|
3
|
|
|
82.67
|
|
||
$118.04
|
|
5
|
|
|
5.9
|
|
118.04
|
|
|
1
|
|
|
118.04
|
|
||
$122.03 to $158.76
|
|
1
|
|
|
6.3
|
|
135.29
|
|
|
0
|
|
|
0.00
|
|
||
$161.50
|
|
6
|
|
|
6.9
|
|
161.50
|
|
|
0
|
|
|
0.00
|
|
||
|
|
29
|
|
|
5.0
|
|
$
|
92.92
|
|
|
13
|
|
|
$
|
63.88
|
|
|
Restricted Stock Outstanding
|
|||||||||
|
Outstanding
(in millions)
|
|
Weighted Average Grant Date Fair Value
|
|
Aggregate
Intrinsic
Value (in millions)
|
|||||
Balance as of January 31, 2019
|
21
|
|
|
$
|
103.33
|
|
|
|
||
Granted - restricted stock units and awards
|
7
|
|
|
161.39
|
|
|
|
|||
Granted - performance-based stock units
|
1
|
|
|
161.50
|
|
|
|
|||
Canceled
|
(1
|
)
|
|
102.06
|
|
|
|
|||
Vested and converted to shares
|
(3
|
)
|
|
102.19
|
|
|
|
|||
Balance as of April 30, 2019
|
25
|
|
|
$
|
121.88
|
|
|
$
|
4,136
|
|
Expected to vest
|
21
|
|
|
|
|
$
|
3,502
|
|
1
|
Three Months Ended April 30,
|
||||||
|
2019
|
|
2018
|
||||
Numerator:
|
|
|
|
||||
Net income
|
$
|
392
|
|
|
$
|
344
|
|
Denominator:
|
|
|
|
||||
Weighted-average shares outstanding for basic earnings per share
|
771
|
|
|
729
|
|
||
Effect of dilutive securities:
|
|
|
|
||||
Convertible senior notes which matured in April 2018
|
0
|
|
|
4
|
|
||
Employee stock awards
|
22
|
|
|
17
|
|
||
Warrants which settled in June and July 2018
|
0
|
|
|
4
|
|
||
Adjusted weighted-average shares outstanding and assumed conversions for diluted earnings per share
|
793
|
|
|
754
|
|
|
Three Months Ended April 30,
|
||||
|
2019
|
|
2018
|
||
Employee stock awards
|
3
|
|
|
3
|
|
|
Three Months Ended April 30, 2019
|
||
Operating lease cost
|
$
|
206
|
|
|
|
||
Finance lease cost:
|
|
||
Amortization of right-of-use assets
|
$
|
16
|
|
Interest on lease liabilities
|
6
|
|
|
Total finance lease cost
|
$
|
22
|
|
|
Three Months Ended April 30, 2019
|
||
Cash paid for amounts included in the measurement of lease liabilities:
|
|
||
Operating cash outflows for operating leases
|
$
|
182
|
|
Operating cash outflows for finance leases
|
4
|
|
|
Financing cash outflows for finance leases
|
2
|
|
|
Right-of-use assets obtained in exchange for lease obligations:
|
|
||
Operating leases
|
159
|
|
|
As of April 30, 2019
|
||
Operating leases:
|
|
||
Operating lease right-of-use assets
|
$
|
2,854
|
|
|
|
||
Operating lease liabilities, current
|
$
|
675
|
|
Noncurrent operating lease liabilities
|
2,383
|
|
|
Total operating lease liabilities
|
$
|
3,058
|
|
|
|
||
Finance leases:
|
|
||
Buildings and building improvements
|
$
|
325
|
|
Computers, equipment and software
|
618
|
|
|
Accumulated depreciation
|
(506
|
)
|
|
Property and equipment, net
|
$
|
437
|
|
|
|
||
Accrued expenses and other liabilities
|
$
|
178
|
|
Other noncurrent liabilities
|
359
|
|
|
Total finance lease liabilities
|
$
|
537
|
|
|
As of April 30, 2019
|
|
Weighted average remaining lease term
|
|
|
Operating leases
|
7 years
|
|
Finance leases
|
14 years
|
|
Weighted average discount rate
|
|
|
Operating leases
|
2.8
|
%
|
Finance leases
|
4.5
|
%
|
|
Operating Leases
|
|
Finance Leases
|
||||
Fiscal Period:
|
|
|
|
||||
Remaining nine months of Fiscal 2020
|
$
|
557
|
|
|
$
|
174
|
|
Fiscal 2021
|
669
|
|
|
67
|
|
||
Fiscal 2022
|
470
|
|
|
23
|
|
||
Fiscal 2023
|
337
|
|
|
23
|
|
||
Fiscal 2024
|
276
|
|
|
24
|
|
||
Thereafter
|
1,109
|
|
|
434
|
|
||
Total minimum lease payments
|
3,418
|
|
|
745
|
|
||
Less: Imputed interest
|
(360
|
)
|
|
(208
|
)
|
||
Total
|
$
|
3,058
|
|
|
$
|
537
|
|
ITEM 2.
|
MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS
|
•
|
cross sell and upsell;
|
•
|
extend existing service offerings;
|
•
|
reduce customer attrition;
|
•
|
expand and strengthen the partner ecosystem;
|
•
|
expand internationally;
|
•
|
target vertical industries;
|
•
|
expand into new horizontal markets;
|
•
|
extend go-to-market capabilities;
|
•
|
ensure strong customer adoption; and
|
•
|
encourage the development of third-party applications on our cloud computing platform.
|
|
April 30,
2019 |
||
Fiscal 2020
|
|
||
Accounts receivable, net
|
$
|
2,153
|
|
Unearned revenue
|
7,585
|
|
|
Operating cash flow
|
1,965
|
|
|
January 31,
2019 |
|
October 31,
2018 |
|
July 31,
2018 |
|
April 30,
2018 |
||||||||
Fiscal 2019
|
|
|
|
|
|
|
|
||||||||
Accounts receivable, net
|
$
|
4,924
|
|
|
$
|
2,037
|
|
|
$
|
1,980
|
|
|
$
|
1,763
|
|
Unearned revenue
|
8,564
|
|
|
5,376
|
|
|
5,883
|
|
|
6,201
|
|
||||
Operating cash flow
|
1,331
|
|
|
143
|
|
|
458
|
|
|
1,466
|
|
|
January 31,
2018 |
|
October 31,
2017 |
|
July 31,
2017 |
|
April 30,
2017 |
||||||||
Fiscal 2018
|
|
|
|
|
|
|
|
||||||||
Accounts receivable, net
|
$
|
3,921
|
|
|
$
|
1,522
|
|
|
$
|
1,572
|
|
|
$
|
1,442
|
|
Unearned revenue
|
6,995
|
|
|
4,312
|
|
|
4,749
|
|
|
4,969
|
|
||||
Operating cash flow
|
1,052
|
|
|
125
|
|
|
331
|
|
|
1,230
|
|
|
Current
|
|
Noncurrent
|
|
Total
|
||||||
As of April 30, 2019
|
$
|
11.8
|
|
|
$
|
13.1
|
|
|
$
|
24.9
|
(1)
|
As of January 31, 2019
|
$
|
11.9
|
|
|
$
|
13.8
|
|
|
$
|
25.7
|
(2)
|
As of October 31, 2018
|
$
|
10.0
|
|
|
$
|
11.2
|
|
|
$
|
21.2
|
(3)
|
As of July 31, 2018
|
$
|
9.8
|
|
|
$
|
11.2
|
|
|
$
|
21.0
|
(4)
|
As of April 30, 2018
|
$
|
9.6
|
|
|
$
|
10.8
|
|
|
$
|
20.4
|
|
As of January 31, 2018
|
$
|
9.6
|
|
|
$
|
11.0
|
|
|
$
|
20.6
|
|
•
|
the SSP of performance obligations for revenue contracts with multiple performance obligations;
|
•
|
the average period of benefit associated with costs capitalized to obtain revenue contracts;
|
•
|
the fair value of assets acquired and liabilities assumed for business combinations;
|
•
|
the recognition, measurement and valuation of current and deferred income taxes and uncertain tax positions; and
|
•
|
the valuation of privately held strategic investments.
|
1
|
Three Months Ended April 30,
|
||||||||||||
|
2019
|
|
% of Total Revenues
|
|
2018
|
|
% of Total Revenues
|
||||||
Revenues:
|
|
|
|
|
|
|
|
||||||
Subscription and support
|
$
|
3,496
|
|
|
94
|
%
|
|
$
|
2,810
|
|
|
93
|
%
|
Professional services and other
|
241
|
|
|
6
|
|
|
196
|
|
|
7
|
|
||
Total revenues
|
3,737
|
|
|
100
|
|
|
3,006
|
|
|
100
|
|
||
Cost of revenues (1)(2):
|
|
|
|
|
|
|
|
||||||
Subscription and support
|
678
|
|
|
18
|
|
|
573
|
|
|
19
|
|
||
Professional services and other
|
236
|
|
|
6
|
|
|
194
|
|
|
7
|
|
||
Total cost of revenues
|
914
|
|
|
24
|
|
|
767
|
|
|
26
|
|
||
Gross profit
|
2,823
|
|
|
76
|
|
|
2,239
|
|
|
74
|
|
||
Operating expenses (1)(2):
|
|
|
|
|
|
|
|
||||||
Research and development
|
554
|
|
|
15
|
|
|
424
|
|
|
14
|
|
||
Marketing and sales
|
1,697
|
|
|
45
|
|
|
1,329
|
|
|
44
|
|
||
General and administrative
|
362
|
|
|
10
|
|
|
295
|
|
|
10
|
|
||
Total operating expenses
|
2,613
|
|
|
70
|
|
|
2,048
|
|
|
68
|
|
||
Income from operations
|
210
|
|
|
6
|
|
|
191
|
|
|
6
|
|
||
Gains on strategic investments, net
|
281
|
|
|
7
|
|
|
211
|
|
|
7
|
|
||
Other expense
|
(9
|
)
|
|
0
|
|
|
(17
|
)
|
|
0
|
|
||
Income before provision for income taxes
|
482
|
|
|
13
|
|
|
385
|
|
|
13
|
|
||
Provision for income taxes
|
(90
|
)
|
|
(3
|
)
|
|
(41
|
)
|
|
(2
|
)
|
||
Net income
|
$
|
392
|
|
|
10
|
%
|
|
$
|
344
|
|
|
11
|
%
|
|
Three Months Ended April 30,
|
||||||||||||
|
2019
|
|
% of Total Revenues
|
|
2018
|
|
% of Total Revenues
|
||||||
Cost of revenues
|
$
|
61
|
|
|
2
|
%
|
|
$
|
39
|
|
|
1
|
%
|
Marketing and sales
|
68
|
|
|
2
|
|
|
30
|
|
|
1
|
|
|
Three Months Ended April 30,
|
||||||||||||
|
2019
|
|
% of Total Revenues
|
|
2018
|
|
% of Total Revenues
|
||||||
Cost of revenues
|
$
|
43
|
|
|
1
|
%
|
|
$
|
34
|
|
|
1
|
%
|
Research and development
|
81
|
|
|
2
|
|
|
66
|
|
|
2
|
|
||
Marketing and sales
|
177
|
|
|
5
|
|
|
120
|
|
|
4
|
|
||
General and administrative
|
42
|
|
|
1
|
|
|
32
|
|
|
1
|
|
|
Three Months Ended April 30,
|
|
Variance
|
|||||||||||
(in millions)
|
2019
|
|
2018
|
|
Dollars
|
|
Percent
|
|||||||
Subscription and support
|
$
|
3,496
|
|
|
$
|
2,810
|
|
|
$
|
686
|
|
|
24
|
%
|
Professional services and other
|
241
|
|
|
196
|
|
|
45
|
|
|
23
|
|
|||
Total revenues
|
$
|
3,737
|
|
|
$
|
3,006
|
|
|
$
|
731
|
|
|
24
|
|
|
Three Months Ended April 30,
|
|
|
||||||
|
2019
|
|
2018
|
|
Variance
Percent
|
||||
Sales Cloud
|
$
|
1,073
|
|
|
$
|
965
|
|
|
11%
|
Service Cloud
|
1,020
|
|
|
848
|
|
|
20%
|
||
Salesforce Platform and Other
|
842
|
|
|
575
|
|
|
46%
|
||
Marketing and Commerce Cloud
|
561
|
|
|
422
|
|
|
33%
|
||
Total
|
$
|
3,496
|
|
|
$
|
2,810
|
|
|
|
|
Three Months Ended April 30,
|
|||||||||||||||
(in millions)
|
2019
|
|
As a % of Total Revenues
|
|
2018
|
|
As a % of Total Revenues
|
|
Variance
Percent
|
|||||||
Americas
|
$
|
2,617
|
|
|
70
|
%
|
|
$
|
2,101
|
|
|
70
|
%
|
|
25
|
%
|
Europe
|
755
|
|
|
20
|
|
|
606
|
|
|
20
|
|
|
25
|
|
||
Asia Pacific
|
365
|
|
|
10
|
|
|
299
|
|
|
10
|
|
|
22
|
|
||
|
$
|
3,737
|
|
|
100
|
%
|
|
$
|
3,006
|
|
|
100
|
%
|
|
24
|
|
|
Three Months Ended April 30,
|
|
Variance
Dollars
|
||||||||
(in millions)
|
2019
|
|
2018
|
|
|||||||
Subscription and support
|
$
|
678
|
|
|
$
|
573
|
|
|
$
|
105
|
|
Professional services and other
|
236
|
|
|
194
|
|
|
42
|
|
|||
Total cost of revenues
|
$
|
914
|
|
|
$
|
767
|
|
|
$
|
147
|
|
Percent of total revenues
|
24
|
%
|
|
26
|
%
|
|
|
|
Three Months Ended April 30,
|
|
Variance
Dollars
|
||||||||
(in millions)
|
2019
|
|
2018
|
|
|||||||
Research and development
|
$
|
554
|
|
|
$
|
424
|
|
|
$
|
130
|
|
Marketing and sales
|
1,697
|
|
|
1,329
|
|
|
368
|
|
|||
General and administrative
|
362
|
|
|
295
|
|
|
67
|
|
|||
Total operating expenses
|
$
|
2,613
|
|
|
$
|
2,048
|
|
|
$
|
565
|
|
Percent of total revenues
|
70
|
%
|
|
68
|
%
|
|
|
|
Three Months Ended April 30,
|
|
Variance
Dollars
|
||||||||
(in millions)
|
2019
|
|
2018
|
|
|||||||
Gains on strategic investments, net
|
$
|
281
|
|
|
$
|
211
|
|
|
$
|
70
|
|
Other expense
|
(9
|
)
|
|
(17
|
)
|
|
8
|
|
|
Three Months Ended April 30,
|
|
Variance
Dollars
|
||||||||
(in millions)
|
2019
|
|
2018
|
|
|||||||
Provision for income taxes
|
$
|
(90
|
)
|
|
$
|
(41
|
)
|
|
$
|
(49
|
)
|
Effective tax rate
|
19
|
%
|
|
11
|
%
|
|
|
1
|
Three Months Ended April 30,
|
||||||
|
2019
|
|
2018
|
||||
Net cash provided by operating activities
|
$
|
1,965
|
|
|
$
|
1,466
|
|
Net cash provided by (used in) investing activities
|
(726
|
)
|
|
276
|
|
||
Net cash provided by financing activities
|
207
|
|
|
1,625
|
|
Instrument
|
|
Date of issuance
|
|
Maturity date
|
|
Effective interest rate for the three months ended April 30, 2019
|
|
April 30, 2019
|
|
January 31, 2019
|
||||
2021 Term Loan
|
|
May 2018
|
|
May 2021
|
|
3.37%
|
|
$
|
500
|
|
|
$
|
499
|
|
2023 Senior Notes
|
|
April 2018
|
|
April 2023
|
|
3.26%
|
|
993
|
|
|
993
|
|
||
2028 Senior Notes
|
|
April 2018
|
|
April 2028
|
|
3.70%
|
|
1,488
|
|
|
1,488
|
|
||
Loan assumed on 50 Fremont
|
|
February 2015
|
|
June 2023
|
|
3.75%
|
|
196
|
|
|
196
|
|
||
Total carrying value of debt
|
|
|
|
|
|
|
|
3,177
|
|
|
3,176
|
|
||
Less current portion of debt
|
|
|
|
|
|
|
|
(4
|
)
|
|
(3
|
)
|
||
Total noncurrent debt
|
|
|
|
|
|
|
|
$
|
3,173
|
|
|
$
|
3,173
|
|
|
Operating
Leases (1) |
|
Finance Leases
|
||||
Fiscal Period:
|
|
|
|
||||
Remaining nine months of Fiscal 2020
|
$
|
557
|
|
|
$
|
174
|
|
Fiscal 2021
|
669
|
|
|
67
|
|
||
Fiscal 2022
|
470
|
|
|
23
|
|
||
Fiscal 2023
|
337
|
|
|
23
|
|
||
Fiscal 2024
|
276
|
|
|
24
|
|
||
Thereafter
|
1,109
|
|
|
434
|
|
||
Total minimum lease payments
|
$
|
3,418
|
|
|
$
|
745
|
|
ITEM 3.
|
QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK
|
Instrument
|
|
Maturity date
|
|
Principal Outstanding as of April 30, 2019
|
|
Interest Terms
|
|
Effective interest rate for the three months ended April 30, 2019
|
||
2021 Term Loan
|
|
May 2021
|
|
$
|
500
|
|
|
Floating
|
|
3.37%
|
2023 Senior Notes
|
|
April 2023
|
|
1,000
|
|
|
Fixed
|
|
3.26%
|
|
2028 Senior Notes
|
|
April 2028
|
|
1,500
|
|
|
Fixed
|
|
3.70%
|
|
Loan assumed on 50 Fremont
|
|
June 2023
|
|
197
|
|
|
Fixed
|
|
3.75%
|
|
Revolving credit facility
|
|
April 2023
|
|
0
|
|
|
Floating
|
|
N/A
|
ITEM 4.
|
CONTROLS AND PROCEDURES
|
ITEM 1.
|
LEGAL PROCEEDINGS
|
ITEM 1A.
|
RISK FACTORS
|
•
|
third-party attempts to fraudulently induce employees or customers into disclosing sensitive information such as user names, passwords or other information to gain access to our customers’ data, our data or our IT systems;
|
•
|
efforts by individuals or groups of hackers and sophisticated organizations, including state-sponsored organizations or nation-states;
|
•
|
cyber-attacks on our internally built infrastructure on which many of our service offerings operate;
|
•
|
vulnerabilities resulting from enhancements and updates to our existing service offerings;
|
•
|
vulnerabilities in the products or components across the broad ecosystem that our services operate in conjunction with and are dependent on;
|
•
|
vulnerabilities existing within newly acquired or integrated technologies and infrastructures;
|
•
|
attacks on, or vulnerabilities in, the many different underlying networks and services that power the internet that our products depend on, most of which are not under our control or the control of our vendors, partners, or customers; and
|
•
|
employee or contractor errors or intentional acts that compromise our security systems.
|
•
|
frequent changes to, and growth in complexity of, the techniques used to breach, obtain unauthorized access to, or sabotage IT systems and infrastructure, which are generally not recognized until launched against a target, possibly resulting in our being unable to anticipate or implement adequate measures to prevent such techniques;
|
•
|
the continued evolution of our internal IT systems as we early adopt new technologies and new ways of sharing data and communicating internally and with partners and customers, which increases the complexity of our IT systems;
|
•
|
authorization by our customers to third-party technology providers to access their customer data, which may lead to our customers' inability to protect their data that is stored on our servers; and
|
•
|
our limited control over our customers or third-party technology providers, or the processing of data by third-party technology providers, which may not allow us to maintain the integrity or security of such transmissions or processing.
|
•
|
potential failure to achieve the expected benefits on a timely basis or at all;
|
•
|
difficulties in, and the cost of, integrating operations, technologies, services, platforms and personnel;
|
•
|
diversion of financial and managerial resources from existing operations;
|
•
|
the potential entry into new markets in which we have little or no experience or where competitors may have stronger market positions;
|
•
|
potential write-offs of acquired assets or investments, and potential financial and credit risks associated with acquired customers;
|
•
|
failure to assimilate acquired employees, which may lead to retention risk with respect to both key acquired employees and our existing key employees or disruption to existing teams;
|
•
|
differences between our values and those of our acquired companies;
|
•
|
difficulties in re-training key employees of acquired companies and integrating them into our organizational structure and corporate culture;
|
•
|
difficulties in and financial costs of addressing acquired compensation structures inconsistent with our compensation structure;
|
•
|
inability to generate sufficient revenue to offset acquisition or investment costs;
|
•
|
inability to maintain relationships with customers and partners of the acquired business;
|
•
|
challenges with the acquired company's third party service providers, including those that are required for ongoing access to third party data;
|
•
|
changes to customer relationships or customer perception of the acquired business as a result of the acquisition;
|
•
|
challenges converting and forecasting the acquired company's revenue recognition policies including subscription-based revenues and revenues based on the transfer of control, as well as appropriate allocation of the customer consideration to the individual deliverables;
|
•
|
difficulty of transitioning the acquired technology onto our existing platforms and customer acceptance of multiple platforms on a temporary or permanent basis;
|
•
|
augmenting the acquired technologies and platforms to the levels that are consistent with our brand and reputation;
|
•
|
potential for acquired products to impact the profitability of existing products;
|
•
|
potential identified or unknown security vulnerabilities in acquired products that expose us to additional security risks or delay our ability to integrate the product into our service offerings or recognize the benefits of our investment;
|
•
|
increasing or maintaining the security standards for acquired technology consistent with our other services;
|
•
|
potential unknown liabilities associated with the acquired businesses;
|
•
|
challenges relating to the structure of an investment, such as governance, accountability and decision-making conflicts that may arise in the context of a joint venture or other majority ownership investments;
|
•
|
unanticipated expenses related to acquired technology and its integration into our existing technology;
|
•
|
negative impact to our results of operations because of the depreciation and amortization of amounts related to acquired intangible assets, fixed assets and deferred compensation;
|
•
|
additional stock-based compensation;
|
•
|
the loss of acquired unearned revenue and unbilled unearned revenue;
|
•
|
delays in customer purchases due to uncertainty related to any acquisition;
|
•
|
ineffective or inadequate controls, procedures and policies at the acquired company;
|
•
|
in the case of foreign acquisitions, challenges caused by integrating operations over distance, and across different languages, cultures and political environments;
|
•
|
currency and regulatory risks associated with foreign countries and potential additional cybersecurity and compliance risks resulting from entry into new markets; and
|
•
|
the tax effects and costs of any such acquisitions including the related integration into our tax structure and assessment of the impact on the realizability of our future tax assets or liabilities.
|
•
|
Vendors of packaged business software, as well as companies offering enterprise apps delivered through on-premises offerings from enterprise software application vendors and cloud computing application service providers, either individually or with others;
|
•
|
Software companies that provide their product or service free of charge, and only charge a premium for advanced features and functionality;
|
•
|
Internally developed enterprise applications, for example by our potential customers’ IT departments;
|
•
|
Marketing vendors, which may be specialized in advertising, targeting, messaging, or campaign automation;
|
•
|
E-commerce solutions from established and emerging cloud-only vendors and established on-premises vendors;
|
•
|
Integration software vendors, integration service providers and API management providers;
|
•
|
Traditional platform development environment companies and cloud computing development platform companies who may develop toolsets and products that allow customers to build new apps that run on the customers’ current infrastructure or as hosted services;
|
•
|
IoT platforms from large companies that have existing relationships with hardware and software companies; and
|
•
|
AI solutions from new startups and established companies.
|
•
|
our ability to retain and increase sales to existing customers, attract new customers and satisfy our customers’ requirements;
|
•
|
the attrition rates for our services;
|
•
|
the rate of expansion and productivity of our sales force;
|
•
|
the length of the sales cycle for our services;
|
•
|
new product and service introductions by our competitors;
|
•
|
our success in selling our services to large enterprises;
|
•
|
changes in unearned revenue and the Remaining Performance Obligation, due to seasonality, the timing of and compounding effects of renewals, invoice duration, size and timing, new business linearity between quarters and within a quarter, average contract term, the collectibility of invoices related to multiyear agreements, the timing of license software revenue recognition, or fluctuations due to foreign currency movements, all of which may impact implied growth rates;
|
•
|
our ability to realize benefits from strategic partnerships, acquisitions or investments;
|
•
|
general economic or geopolitical conditions, which may adversely affect either our customers’ ability or willingness to purchase additional subscriptions or upgrade their services, or delay a prospective customer's purchasing decision, reduce the value of new subscription contracts, or affect attrition rates;
|
•
|
variations in the revenue mix of our services and growth rates of our cloud subscription and support offerings, including the timing of software license sales and sales offerings that include an on-premise software element for which the revenue allocated to that deliverable is recognized upfront;
|
•
|
the seasonality of our sales cycle, including software license sales, and timing of contract execution and the corresponding impact on revenue recognized at a point in time;
|
•
|
changes in our pricing policies and terms of contracts, whether initiated by us or as a result of competition;
|
•
|
changes in payment terms and the timing of customer payments and payment defaults by customers;
|
•
|
the seasonality of our customers’ businesses, especially Commerce Cloud customers, including retailers and branded manufacturers;
|
•
|
fluctuations in foreign currency exchange rates such as with respect to the British Pound;
|
•
|
the amount and timing of operating costs and capital expenditures related to the operations and expansion of our business;
|
•
|
the number of new employees;
|
•
|
the timing of commission, bonus, and other compensation payments to employees;
|
•
|
the cost, timing and management effort required for the introduction of new features to our services;
|
•
|
the costs associated with acquiring new businesses and technologies and the follow-on costs of integration and consolidating the results of acquired businesses;
|
•
|
expenses related to our real estate, our office leases and our data center capacity and expansion;
|
•
|
timing of additional investments in our enterprise cloud computing application and platform services and in our consulting services;
|
•
|
expenses related to significant, unusual or discrete events, which are recorded in the period in which the events occur;
|
•
|
extraordinary expenses such as litigation or other dispute-related settlement payments;
|
•
|
income tax effects, including potential material changes due to income tax provision variability and the impact of changes in U.S. federal and state and international tax laws, interpretations of U.S. Tax Court decisions, as well as changes in those decisions, and changes international tax structures, applicable to corporate multinationals;
|
•
|
the timing of payroll and other withholding tax expenses, which are triggered by the payment of bonuses and when employees exercise their vested stock awards;
|
•
|
technical difficulties or interruptions in our services;
|
•
|
changes in interest rates and our mix of investments, which would impact the return on our investments in cash and marketable securities;
|
•
|
conditions, particularly sudden changes, in the financial markets, which have impacted and may continue to impact the value and liquidity of our investment portfolio;
|
•
|
changes in the fair value of our strategic investments in early-to-late stage privately held and public companies, which could negatively and materially impact our financial results, particularly in periods of significant market fluctuations;
|
•
|
equity issuances, including as consideration in acquisitions;
|
•
|
the timing of stock awards to employees and the related adverse financial statement impact of having to expense those stock awards on a straight-line basis over their vesting schedules;
|
•
|
evolving regulations of cloud computing and cross-border data transfer restrictions and similar regulations;
|
•
|
regulatory compliance costs; and
|
•
|
the impact of new accounting pronouncements and associated system implementations, for example, the adoption of Accounting Standards Update No. 2016-02, “Leases (Topic 842)” (“ASU 2016-02”), which includes the accounting for lease assets and lease liabilities.
|
•
|
localization of our services, including translation into foreign languages and associated expenses;
|
•
|
regulatory frameworks or business practices favoring local competitors;
|
•
|
pressure on the creditworthiness of sovereign nations, where we have customers and a balance of our cash, cash equivalents and marketable securities;
|
•
|
evolving domestic and international tax environments;
|
•
|
liquidity issues or political actions by sovereign nations, including nations with a controlled currency environment, which could result in decreased values of these balances or potential difficulties protecting our foreign assets or satisfying local obligations;
|
•
|
foreign currency fluctuations and controls, which may make our services more expensive for international customers and could add volatility to our operating results;
|
•
|
compliance with multiple, conflicting, ambiguous or evolving governmental laws and regulations, including employment, tax, privacy, anti-corruption, import/export, antitrust, data transfer, storage and protection, and industry-specific laws and regulations, including rules related to compliance by our third-party resellers and our ability to identify and respond timely to compliance issues when they occur;
|
•
|
vetting and monitoring our third-party resellers in new and evolving markets to confirm they maintain standards consistent with our brand and reputation;
|
•
|
uncertainty regarding regulation, currency, tax, and operations resulting from the United Kingdom's planned exit from the European Union ("Brexit") that could disrupt trade, the sale of our services and commerce, and movement of our people between the United Kingdom, European Union, and other locations;
|
•
|
changes in the public perception of governments in the regions where we operate or plan to operate;
|
•
|
regional data privacy laws and other regulatory requirements that apply to outsourced service providers and to the transmission of our customers’ data across international borders, which grow more complex as we scale and expand into new markets;
|
•
|
treatment of revenue from international sources, intellectual property considerations and changes to tax codes, including being subject to foreign tax laws and being liable for paying withholding income or other taxes in foreign jurisdictions;
|
•
|
different pricing environments;
|
•
|
difficulties in staffing and managing foreign operations;
|
•
|
different or lesser protection of our intellectual property;
|
•
|
longer accounts receivable payment cycles and other collection difficulties;
|
•
|
natural disasters, acts of war, terrorism, pandemics or security breaches;
|
•
|
regional economic and political conditions; and
|
•
|
the imposition of and changes in the United States' and other governments' trade regulations and restrictions.
|
•
|
impair our ability to obtain additional financing in the future for working capital, capital expenditures, acquisitions, general corporate or other purposes;
|
•
|
cause us to dedicate a substantial portion of our cash flows from operations towards debt service obligations and principal repayments; and
|
•
|
make us more vulnerable to downturns in our business, our industry or the economy in general.
|
•
|
variations in our operating results, earnings per share, cash flows from operating activities, unearned revenue, remaining performance obligation, year-over-year growth rates for individual core service offerings and other financial metrics and non-financial metrics, such as transaction usage volumes and other usage metrics, and how those results compare to analyst expectations;
|
•
|
variations in, and limitations of, the various financial and other metrics and modeling used by analysts in their research and reports about our business;
|
•
|
forward-looking guidance to industry and financial analysts related to, for example, future revenue, unearned revenue, remaining performance obligation, cash flows from operating activities and earnings per share, the accuracy of which may be impacted by various factors, many of which are beyond our control, including general economic and market conditions;
|
•
|
changes in the estimates of our operating results or changes in recommendations by securities analysts that elect to follow our common stock;
|
•
|
announcements of technological innovations, new services or service enhancements, strategic alliances or significant agreements by us or by our competitors;
|
•
|
announcements by us or by our competitors of mergers or other strategic acquisitions, or rumors of such transactions involving us or our competitors;
|
•
|
announcements of customer additions and customer cancellations or delays in customer purchases;
|
•
|
the coverage of our common stock by the financial media, including television, radio and press reports and blogs;
|
•
|
recruitment or departure of key personnel;
|
•
|
disruptions in our service due to computer hardware, software, network or data center problems;
|
•
|
the economy as a whole, geopolitical conditions, including global trade concerns, market conditions in our industry and the industries of our customers;
|
•
|
trading activity by a limited number of stockholders who together beneficially own a significant portion of our outstanding common stock;
|
•
|
the issuance of shares of common stock by us, whether in connection with an acquisition or a capital raising transaction;
|
•
|
issuance of debt or other convertible securities; and
|
•
|
environmental, social, governance and other issues impacting the Company's reputation.
|
•
|
permit the board of directors to establish the number of directors;
|
•
|
provide that directors may only be removed with the approval of holders of 66 2/3 percent of our outstanding capital stock;
|
•
|
require super-majority voting to amend some provisions in our amended and restated certificate of incorporation and bylaws;
|
•
|
authorize the issuance of “blank check” preferred stock that our board could use to implement a stockholder rights plan (also known as a “poison pill”);
|
•
|
prohibit stockholder action by written consent, which requires all stockholder actions to be taken at a meeting of our stockholders;
|
•
|
provide that the board of directors is expressly authorized to make, alter or repeal our bylaws; and
|
•
|
establish advance notice requirements for nominations for election to our board or for proposing matters that can be acted upon by stockholders at annual stockholder meetings.
|
ITEM 4.
|
MINE SAFETY DISCLOSURES
|
ITEM 5.
|
OTHER INFORMATION
|
ITEM 6.
|
EXHIBITS
|
Exhibit
No.
|
|
|
|
Provided
Herewith
|
|
Incorporated by Reference
|
||||||
Exhibit Description
|
|
Form
|
|
SEC File No.
|
|
Exhibit
|
|
Filing Date
|
||||
3.1
|
|
|
|
|
8-K
|
|
001-32224
|
|
3.1
|
|
6/13/2018
|
|
3.2
|
|
|
|
|
8-K
|
|
001-32224
|
|
3.1
|
|
8/8/2018
|
|
31.1
|
|
|
X
|
|
|
|
|
|
|
|
|
|
31.2
|
|
|
X
|
|
|
|
|
|
|
|
|
|
31.3
|
|
|
X
|
|
|
|
|
|
|
|
|
|
32.1
|
|
|
X
|
|
|
|
|
|
|
|
|
|
101.INS
|
|
XBRL Instance Document
|
|
|
|
|
|
|
|
|
|
|
101.SCH
|
|
XBRL Taxonomy Extension Schema Document
|
|
|
|
|
|
|
|
|
|
|
101.CAL
|
|
XBRL Taxonomy Extension Calculation Linkbase Document
|
|
|
|
|
|
|
|
|
|
|
101.DEF
|
|
XBRL Extension Definition
|
|
|
|
|
|
|
|
|
|
|
101.LAB
|
|
XBRL Taxonomy Extension Label Linkbase Document
|
|
|
|
|
|
|
|
|
|
|
101.PRE
|
|
XBRL Taxonomy Extension Presentation Linkbase Document
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Dated: June 5, 2019
|
|
|
|
|
|
|
|
|
|
|
salesforce.com, inc.
|
||
|
|
|
|
|
|
|
|
|
|
|
By:
|
|
/S/ MARK J. HAWKINS
|
|
|
|
|
|
|
Mark J. Hawkins
|
|
|
|
|
|
|
President and
Chief Financial Officer
(Principal Financial Officer)
|
|
|
|
|
|
|
|
Dated: June 5, 2019
|
|
|
|
|
|
|
|
|
|
|
salesforce.com, inc.
|
||
|
|
|
|
|
|
|
|
|
|
|
By:
|
|
/S/ JOE ALLANSON
|
|
|
|
|
|
|
Joe Allanson
|
|
|
|
|
|
|
Executive Vice President,
Chief Accounting Officer
and Corporate Controller
(Principal Accounting Officer)
|
1.
|
I have reviewed this report on Form 10-Q of salesforce.com, inc.;
|
2.
|
Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;
|
3.
|
Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;
|
4.
|
The registrant's other certifying officers and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:
|
a)
|
Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;
|
b)
|
Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;
|
c)
|
Evaluated the effectiveness of the registrant's disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and
|
d)
|
Disclosed in this report any change in the registrant's internal control over financial reporting that occurred during the registrant's most recent fiscal quarter that has materially affected, or is reasonably likely to materially affect, the registrant's internal control over financial reporting; and
|
5.
|
The registrant's other certifying officers and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant's auditors and the audit committee of the registrant's board of directors (or persons performing the equivalent functions):
|
a)
|
All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant's ability to record, process, summarize and report financial information; and
|
b)
|
Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant's internal control over financial reporting.
|
June 5, 2019
|
/s/ MARC BENIOFF
|
|
Marc Benioff
|
|
Chairman of the Board of Directors and
Co-Chief Executive Officer
(Principal Executive Officer)
|
1.
|
I have reviewed this report on Form 10-Q of salesforce.com, inc.;
|
2.
|
Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;
|
3.
|
Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;
|
4.
|
The registrant's other certifying officers and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:
|
a)
|
Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;
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b)
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Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;
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c)
|
Evaluated the effectiveness of the registrant's disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and
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d)
|
Disclosed in this report any change in the registrant's internal control over financial reporting that occurred during the registrant's most recent fiscal quarter that has materially affected, or is reasonably likely to materially affect, the registrant's internal control over financial reporting; and
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5.
|
The registrant's other certifying officers and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant's auditors and the audit committee of the registrant's board of directors (or persons performing the equivalent functions):
|
a)
|
All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant's ability to record, process, summarize and report financial information; and
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b)
|
Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant's internal control over financial reporting.
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June 5, 2019
|
/s/ KEITH BLOCK
|
|
Keith Block
|
|
Co-Chief Executive Officer
(Principal Executive Officer)
|
1.
|
I have reviewed this report on Form 10-Q of salesforce.com, inc.;
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2.
|
Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;
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3.
|
Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;
|
4.
|
The registrant's other certifying officers and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:
|
a)
|
Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;
|
b)
|
Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;
|
c)
|
Evaluated the effectiveness of the registrant's disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and
|
d)
|
Disclosed in this report any change in the registrant's internal control over financial reporting that occurred during the registrant's most recent fiscal quarter that has materially affected, or is reasonably likely to materially affect, the registrant's internal control over financial reporting; and
|
5.
|
The registrant's other certifying officers and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant's auditors and the audit committee of the registrant's board of directors (or persons performing the equivalent functions):
|
a)
|
All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant's ability to record, process, summarize and report financial information; and
|
b)
|
Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant's internal control over financial reporting.
|
June 5, 2019
|
/s/ Mark J. Hawkins
|
|
Mark J. Hawkins
|
|
President and Chief Financial Officer
(Principal Financial Officer)
|
June 5, 2019
|
/s/ MARC BENIOFF
|
|
Marc Benioff
|
|
Chairman of the Board of Directors and
Co-Chief Executive Officer
(Principal Executive Officer)
|
June 5, 2019
|
/s/ KEITH BLOCK
|
|
Keith Block
|
|
Co-Chief Executive Officer
(Principal Executive Officer)
|
June 5, 2019
|
/s/ MARK J HAWKINS
|
|
Mark J. Hawkins
|
|
President and Chief Financial Officer
(Principal Financial Officer)
|