CRM · Forward model · Bear case

The Bear case, 20 quarters out

Each segment is projected from its own operating driver, rolled up into consolidated cash flow, and discounted back to a fair value per share. The assumptions below are editable — change them and every number on this page moves with them.

Salesforce publishes a two-way revenue split and nothing finer. The cloud-level breakdown people still quote - Sales, Service, Platform and Other, Marketing and Commerce, Integration and Analytics - appears in neither the quarterly release, the 10-Q, nor the FY2026 10-K; the company stopped publishing it. So this model has two verticals because two is what is disclosed, and every quarter of both is a reported figure that sums exactly to the reported total. Cost of revenue is disclosed on the same two lines, which is why both gross margins here are reported rather than assumed. The subscription driver is Salesforce's own forward measure: current remaining performance obligation, the contracted revenue due in the next twelve months, times the rate it converts to revenue. That conversion has held between 31% and 33% across the last two years, so it is a measured relationship rather than a guess, and both halves move on their own slider. Agentforce is deliberately not a vertical. Its $1.2bn is disclosed as ARR, not revenue, and that ARR is already earning inside the Subscription and support line above - a separate line would count the same dollars twice, the same reason the Uber model keeps autonomy inside Mobility. Agentforce appears here where it honestly can: in the growth rate of the contracted book, and in the scenarios. What this model labels EBITDA is closer to Salesforce's non-GAAP operating income than to either EBITDA or GAAP operating income. Operating expenses are not split by revenue stream, so all research and development, sales and marketing and general and administrative sits in one overhead figure, set at 42.6% of revenue - the number that makes the two disclosed gross margins net down to exactly the 34.3% non-GAAP operating margin guided for FY2027. Read the exit multiple against that, not against EBITDA. Two balance-sheet notes. Net cash is NEGATIVE $27.4bn: Salesforce issued $25bn of debt to fund an accelerated share repurchase, taking noncurrent debt to $39.3bn against $11.8bn of cash and securities. And the share count of 823 million is the diluted figure from the April quarter, after 103 million ASR shares were delivered but before the final settlement expected in Q3 FY2027 - roughly a fifth of the programme's shares are still to come, so holding the count flat understates every case. The basis quarter is the three months ended 30 April 2026. Q2 FY2027 reports on 26 August 2026, five days after this was written.

Where each case comes from

From cash flow to fair value

The projected path

Every row is projected. A year-over-year change is shown only where the quarter it compares against exists — an em dash means there is no comparable quarter, not a flat year.

Model revisions

Assumptions are marked to reality as each quarter prints. Every change is appended here, with the fair value the model produced at the time, so the model's own history stays visible.