Kash Rangan: Hi. Thank you very much. Marc, as you talked — you talk to a lot of CEOs across all the breadth of industries. What are they saying about the — their business and their propensity to spend real dollars in Data Cloud with Salesforce? And if that comes true, could the company re accelerate top line? One for you, Amy. You seem to sound confident that leading indicators are rebounding. What are those leading indicators? We can’t quantify, at least qualitatively, can you talk about the leading indicators? And how much of a lag is there between those indicators and how they show up in revenue? Thank you so much and congrats.
Marc Benioff: Well, Kash, this is basically what every software company wants. You want a new killer app. Sometimes you can get it through organic innovation. Sometimes you get it through inorganic innovation. We got lucky. We’ve done it with organic innovation, with Data Cloud. I think Data Cloud is everything that we want at this moment for a few different reasons. First of all, yes, it’s an incredible new cloud and we’ve seen what that kind of can do for Salesforce when we had Sales Cloud to Service Cloud to Marketing Cloud to platform. And of course, we also had these other clouds that we picked up inorganically, commerce, Tableau, Slack, etc. But this incredible new organic cloud, the difference with this cloud and the difference between what’s ever happened with Salesforce before, this cloud makes every other cloud better.
So the hot new, exciting version of Sales Cloud, the hottest new feature in Sales Cloud, what’s going to transform the tens of thousands of Sales Cloud customers that we have out there that we’ve been working on building for the last two and a half decades is Data Cloud. And Service Cloud — the new version of Service Cloud is the Service Cloud plus Data Cloud. And Marketing Cloud read the gartner MQ. We vanquished all of the other competitors completely with this product because it’s so deeply integrated with what we’re doing already and everything else in marketing. And the platform is extended with Data Cloud. And if you have this other data infrastructure in your company, any of the big queries and the redshifts and the snowflakes, I went through all this.
It’s made better with Data Cloud because it unleashes that trap data to your users. This is a compelling reason to use Data Cloud all by itself. But that would be if we were not in the greatest transformation of our industry with artificial intelligence, where we so badly need this data. We — yes, we always love to have another data lake. We would have loved to have a data lake integrated with sales cloud many years ago. Okay, we have that. But why is it more important right now? Yes, we have the data lake, we have the repository, we have the warehouse, but now it has deeply also integrated into the AI. That is why every customer must buy this product if they are going to achieve the nirvana that we can see for businesses, the trinity that we talked about, productivity, customer relationships, margins when you get data and AI working together.
We can do it. This is our message to our salespeople, to our partners, to all of you. This is an incredible moment. That is why we have to execute like hell this year. Fiscal year ’25 needs to be one thing, the year of Data Cloud.
Amy Weaver: Okay. Great. And Kash, thanks for the question about leading indicators. I think first you obviously heard the excitement about Data Cloud. And if you didn’t…
Marc Benioff: I can go through it again. I’ll do it one more time.
Amy Weaver: [Multiple Speakers] Let’s just start with that, I’m looking at a leading indicator. So specifically there are a number of things that we look at that tend to be leading indicators that things may not be as good. Now that would be something like create and close SMB, self-served. I’ve talked a lot about those over the past few years, but I do feel very good about some things I’m seeing right now. It is the execution from our team and we’ve really seen this over the past two quarters and that’s really led to improved bookings growth. We’ve seen AE productivity that is up. Brian talked a lot about that last quarter. It was fantastic. We look at our pipeline for indications of going forward. That said, as we’ve talked about, our top line expectations do include the lagging impact from the measured buying environment that began a couple of years ago.
It’s just going to take time for that to work through our system, but I am seeing some nice indicators that give me a lot of hope.
Michael Spencer: Thanks, Kash. Brandon, we’ll take the next question.
Operator: Your next question comes from Karl Keirstead with UBS. Please go ahead.
Karl Keirstead: Okay. Great. Maybe a two-parter for Brian. Two elements of the business that I think you have responsibility for. One is around pricing and bundling, and you mentioned Einstein 1. Just curious, when will that be a needle mover for revenues? How much of that uplift are you baking into the guide this year? And then also on the pro services side, typically not a focus area for anybody on this call, but down 9% in the quarter was obviously an inflection down. What’s happening with that? Is that tight discretionary spend or is that Salesforce consciously pushing more work to your SI partners? Thanks on both.
Marc Benioff: So before you hit that, I want you to hit the service. But before you do that, when you think AI and you think obviously we all know what ACV is, I think it’s basically a term that we created. Now it’s industry wide, AOV, CSM. Brian, you created that. ACV this year, we obviously have huge goals internally. Okay? A material part of this ACV needs to be Data Cloud. This is important. This is the AI number. This is everything that AI, Einstein 1, the artificial intelligence, Data Cloud, we have to bring this all together. That’s why we call it Einstein 1. Look at the Einstein 1 SKU. Look at what we call UE plus. That is where you’re going to see the material ACV traction. That is our focus intention. Of course, we don’t know what’s going to really happen, but when we got all of our — we did a huge kickoff last week in Vegas.
We brought 5,000 of our top executives, most 80% for sales. We had 70,000 online. We had one message to them, Data Cloud. Number one, Data Cloud. Number one, AI become a great storyteller about these stories. Number two. Number three, sell UE Plus, sell Einstein 1. Number four, deliver the customer success. Number five, our incredible new Ohana 2.0 culture. These are the five things we’re doing this year. So it’s deeply integrated with that, and this absolutely must be part of everything we’re doing. But when you think AI, think Data Cloud. Brian?
Brian Millham: Thanks, Marc. Karl, back to your question, on pricing and bundling, we’re excited about the progress we’ve made here. UE plus is a good example of what we’re seeing, good acceleration. It’s not the only thing we’re doing in pricing and packaging. Obviously we did a price increase last year and seeing some benefits to that. Certainly, we’re simplifying the way that we are putting quotes in the market, fewer SKUs, making it easier for our sellers to get out there. In terms of materiality in the short term, you’re not going to really see it show up. We did it in the second half of last year. And so while we’ve seen great progress and there’s a lot of promise for it in terms of this year’s revenue guide, not a huge factor in our growth numbers this year, you will see it start to show up in year two and three as we roll through the renewals, the uplift, etc., and some of the incremental pricing changes that we’re going to do.
On ProServe, a good question. I think the big issue, and it’s really been felt across the entire professional services industry, a bit of headwinds on customers willingness to do massive transformation. We really felt that during the pandemic that customers were coming to us and saying, I want to make a multiyear commitment to your services and spend significant amount of money, these very large transactions and services. Now our customers are saying, hey, let me take a smaller bite at the apple. Let me start smaller, get to time to value faster, let me get the benefits of the technology sooner. And so while the demand remains high, it’s just smaller transactions that are getting done vis-a-vis last year and the year before that. So the tough compares on large deals, smaller transactions.
For us, in a lot of ways, very good. Let’s get our customers proving out the technology, let’s go faster, but having an impact on our professional services business right now.
Michael Spencer: Great. Thanks, Karl. Brandon, let’s go to the next question.
Operator: Your next question comes from Mark Murphy with JPMorgan. Please go ahead.
Mark Murphy: Thank you very much. For Amy and Brian, the gross margin and sales efficiency metrics are quite strong this quarter. And so I’m curious, just from a standpoint of eating your own dog food or drinking your own champagne, have you been able to realize any benefit from deploying either service GPT or sales GPT internally to save time for your own customer support agents or your own sales teams? I’m just wondering, if you — are they suddenly becoming more productive or able to do more with less already?
Brian Millham: Yeah, Mark. Thank you. We are a big believer on sales on Salesforce. We are deploying our own AI technology internally. Our sales teams are using it. Absolutely, we are seeing benefits right now. But the biggest benefit we’ve seen actually has been in our support operation with case summaries. Our ability to get — to tap into knowledge bases faster to get knowledge surfaced within the flow of work. And so it absolutely is part of our margin expansion strategy going forward, which is how do we leverage our own AI to drive more efficiencies in our business to augment the work that’s being done in sales and in service and in marketing and even into our commerce efforts as well. So we’re excited about the future there as well is leveraging our own technology to drive those efficiencies. Amy, I don’t know if you have anything else to add to that.
