Operator: Your next question comes from the line of Brent Thill with Jefferies.
Brent Thill: Amy, given Marc’s #1 profit — goal of profitability, can you outline where this big jump is coming from? Can you give us just a sense of the big areas that you feel that you can really cut? And I guess, back to Marc, it seems like you can keep growing at a pretty good rate even with higher margins. So this doesn’t really feel like it’s really sacrificing growth when you’re guiding to still a double-digit number.
Amy Weaver: Brent, thanks for the question. So we’ve got great plans for this year. As you know, we guided to 27% for fiscal year ’24, and we plan to hit 30% early in the following year. Very excited about what we’re doing. This is a journey that we’ve been on for quite some time. Just in the last 2 years, we have increased our operating margin almost 500 basis points, and this was while fully absorbing Slack. We announced at Investor Day, we were going to keep going and set out a goal of 25% or more by FY ’26. We really hit the gas pedal on that over the last 90 days, accelerating to the 27 and the 30 that I mentioned to you. And again, as I said, even at 30, I don’t view as a ceiling. That’s really just getting us started on this front.
Now in terms of how this is going on, there has been a lot we’ve been doing leading up to this with discipline across the company, looking for savings. We took 2 major steps in January. One was the real estate. We announced that we are going to be shrinking our global real estate considerably over the upcoming years. The other was the headcount. And on the job eliminations, I just do want to pause for a moment on that. On the call like this, it’s easy to talk about that very clinically as the headcount just represents dollars and not real human beings, we all fully realize that there’s employees whose lives and careers and families were deeply impacted by these decisions. And I just want to assure our employees that we never lose sight of that.
But these actions weren’t our first steps, and there are going to be plenty more actions that we take to increase our operating margin going forward. We have a number of initiatives underway. Brian talked about quite a few in the sales and marketing area. Sales and G&A are really 2 of our greatest opportunities, although we have started a comprehensive operating and go-to-market review that is going across all of our business. This has led — Bain is coming in to do this and to work with us and to go through with this. I think that we’ve got a great initiatives underway. The other thing I would say, finally, in terms of my confidence, it really comes back to the passion and the skills of our employees. When we focus on sales, we became the fastest-growing enterprise software company ever.
When we focus on product, we created an unmatched Customer 360. And now we are asking all of these incredibly talented and passionate employees to bring that same focus to productivity and efficiency. And with all of them behind us, I have no doubt that we’re going to be world class for profitability. .
Operator: Your next question comes from the line of Karl Keirstead with UBS.
Karl Keirstead: Amy, just continuing on the margin conversation, you hinted in your comments about a desire to close the gap between GAAP and non-GAAP earnings. I’m just wondering if you could talk a little bit about what key levers you’re using to do that. You hinted that adjustments to the equity program. It might be interesting to hear a little bit more. And over what time frame do you think that bridge might close?
