Good afternoon. My name is Christie and I will be your conference operator today. At this time, I would like to welcome everyone to the CRM Q4 FY 'fourteen Earnings Conference Call. All lines have been placed on mute to prevent any background noise. After the speakers' remarks, there will be a question and answer session.
Director of Investor Relations, you may begin your conference.
Thanks so much, Christie. Good afternoon, and thanks for joining us to discuss our fiscal Q4 and full year 20 14 results. Our 4th quarter results press release, SEC filings and a webcast replay of today's call can be found on our Investor Relations website at www. Salesforce.com/investor. We'll also post the highlights of today's call on Twitter at the handle salesforceir.
On the call today are Mark Benioff, Chief Executive Officer and Graham Smith, Chief Financial Officer. Mark and Graham will open with a few remarks, then we'll open the call for questions. Our commentary today will primarily be in non GAAP terms. Reconciliations between our GAAP and non GAAP results and guidance can be found in our earnings press release issued earlier today. During the call, we may offer additional metrics to provide further insight into our business or results.
This detail may or may not be provided in the future. We may also reference certain unreleased services or features not yet available. We cannot guarantee future timing or availability of these services or features and so recommend that customers make purchase decisions based on services and features currently available. The purpose of today's call is to provide you with information regarding Q4 2014 results. Some of our comments may contain forward looking statements, which are subject to risks, uncertainties and assumptions.
Should any of these risks or uncertainties materialize or should our assumptions prove to be incorrect, actual company results could differ materially from these forward looking statements. A description of risks, uncertainties and assumptions and other risk factors that could affect our financial results are included in our SEC filings included in our most recent report on Form 10 2, particularly under the heading Risk Factors. So with that, I'll turn the call over to Mark. All right. Tell everyone that I'm thrilled to announce just this morning Salesforce was named by Fortune Magazine as the world's number one most admired software company.
It's the 2nd year in a row that we received this tremendous recognition from Fortune Magazine. I just want to thank them so much and we're delighted to have that honor. And I'd also like to congratulate our team here at Salesforce for just an outstanding performance for our Q4 fiscal year. I just want to thank all of our employees, our customers, our partners, everyone we as I'm sure everyone can see by our numbers we had a spectacular finish to net yet what is absolutely another year of just exceptional growth. Now if you haven't had a chance to look at the numbers, you will see that revenue for the Q4 grows 37% from a year ago to $1,150,000,000 and our full fiscal year 2014 revenue grew 33% to more than $4,000,000,000 dollars and we are about to push through this $5,000,000,000 milestone run rate any minute you can see that.
No other software company of our size and scale is going up to speed. Deferred revenue grew by 35% year over year to more than 2,500,000,000 and the dollar value of book business on and off the balance sheet is now $7,000,000,000 And I'm sure everyone has seen that we have raised our guidance by $100,000,000 which is really unusual and just really speaks to the acceleration that we've had in our business to 5.3 $1,000,000,000 we're going to get into that detail in a moment. Now during the quarter, we significantly grew the number of 7 and 8 figure transactions compared to the Q4 of last year. We had more than 200 transactions in the quarter that were 7 figures or more, company in the CRM space. In CRM to do see more than 200 transactions that were 7 figures or greater is just incredible.
And I know that none of our peers are seeing these large transaction volume like this. In addition, I'm also delighted to announce that we are raising our fiscal year 2015 revenue guidance by $100,000,000 to $5,300,000,000 which is the full year growth rate of 30% at the high end of our range. We couldn't be more happy about that and we're committed to improving non GAAP profitability by 125 basis points to 150 basis points, which is a huge goal of mine for this year and increasing cash flow growth this year, while also continuing to deliver on this outstanding pace of top line growth. So just a great job by the company. I just want to congratulate everybody.
For 15 years, Salesforce has been the catalyst and evangelist for innovation enterprise software and now we can really see the next generation has occurred. Customers are really connecting with their customers in entirely new ways. We're benefiting from that. We're absolutely entering this 3rd wave of computing where everything is connected. And customer relationship management really is the heart of all of this because behind every tweet, behind every app, behind everything is a customer.
And this is our message as we get out on tour that everything that's happening is about the customer. And this vision has opened a door for thousands of companies and empower them to connect with their customers in a deeper way through this next generation devices and apps some products. And if you are a Dreamforce, more than 140,000 people registered to attend and experience the power of Dreamforce this year, they saw Salesforce 1. And Salesforce 1, everyone has used it for the 250 ISDs are building on top of it, for all the custom code that's already been deployed on it by our customers. It's just a radically new customer platform for the Internet of customers that is social, it is mobile, it is cloud, it connects everything.
And I use it every day myself and I'll tell you the story. We are closing out our fiscal year, it was the end of January and I was invited by a friend of mine, Walter Robb, who was a Dreamforce, he's the CEO of Whole Foods to come down and be in a dinner in Arizona and everyone of course is enjoying their dinner and under the table I have my iPhone and I'm able to see with all my analytics and everything exactly how the quarter is closing out. I don't think there's probably too many CEOs who have that power today, but it's something that everybody needs, because everybody wants to run their business on their phone. And because Salesforce 1 was built to API first, because it connect with anything and everything that runs on all these mobile devices, completely transforms how you run your business. And I'm thrilled to announce that we have more than 250 major ISVs have signed up to build Salesforce One Apps on our AppExchange and more than 30 Salesforce One Apps like Evernote and Dropbox and LinkedIn and HP are live on the AppExchange today that is really exciting.
Our focus on the customer success, the adoption of our technology, making these technology market transitions, the movement to things like mobile, the movement to cloud, the movement to social, the movement to the world connected world that really has defined Salesforce over the last 15 years. And it's why you see today the Service Cloud is the world's number one platform for customer service and support. And in this new research technology industry. And I was with their CEO at the World Economic Forum. He keynoted and led the kickoff panel for the World Economic Forum this year.
I mean, we've really seen this incredible shift. In addition to our service cloud with desk.com, we're bringing this whole customer service concept to small business as well and that's been just an incredible addition to our momentum. The ExactTarget Marketing Cloud is the world's most powerful customer platform for 1 to 1 marketing, probably one of the really great accomplishments of the year, not just Salesforce 1, but also the ExactTarget Marketing Cloud, really defining that Salesforce is the absolute leader in marketing today. And I mentioned Forrester, according to them, spending on digital marketing is going to double in 5 years 30% of total marketing spend by 2017. And I think you've heard me say that I really think that it's imminent that CMOs going to be spending more on technology than CIOs.
Our flagship Sales Cloud is the world's number one platform for sales, undisputed leader in CRM according to IDC, another phenomenal research organization. And in addition, we're consistently ranked as well in that area by Forrester as well. So really cool growth in sales, in service, in marketing, which are huge growth areas for industry and in our platform, the number one platform for developing next generation apps. Of course, we've got this incredible trifecta with force. Com, Roku and Fuel, which is the exact target platform and the ability to build these next generation apps is why more than 1,500,000 app developers are now on our platforms, up 50% from last year, thousands of ISVs developing on our platform, so much activity on the app Exchange, so many new mobile apps happening on Salesforce 1, so many new marketing apps happening on Fuel, phenomenal productivity of developers with Heroku, especially these Ruby developers just love Heroku.
And now with our next generation of service marketing, sales and platform technologies, these companies have all the tools they need to connect with their customers in these new ways. And for example, Humana, who is one of the largest healthcare providers in the U. S, selected our service cloud in the quarter to embed a service button right inside their apps. And we saw that also at Dreamforce. We saw Philips embed a service button right on their ultrasound machine, that's obviously a huge trend.
And everybody needs a service cloud and everybody needs a help button on their product, a physical button or virtual button. In the quarter, we also strengthened our partnership with General Electric and their oil and gas group. They've selected Service Cloud, ExactTarget Marketing a huge fan of General Electric and the CEO spoke at Dreamforce in the previous year. And Maersk, one of the world's largest shipping and transportation company selected our service cloud and Salesforce 1 to bring all their customer product and supply chain together. So the pace at which these companies are embracing our next generation customer platform is phenomenal.
Our progress with Salesforce 1 is phenomenal. Our progress with the marketing cloud is phenomenal. And of course, we also brought a credible new distribution leader this year with Keith Block, who has completely transformed how we are going to market. And taking those three things into consideration, I'm absolutely thrilled to tell you that our service delivered more than 100,000,000,000 transactions in the quarter, up 49% from a year ago and averaged more than 1,700,000,000 transactions every single business day and nothing speaks more to the value of Salesforce than the actual usage of our products, their adoption, speed, the reliability, the trust that our customers come to expect and that customer success is also why I'm also very pleased to announce that our attrition is down to the lowest levels we've seen in the history of our company. So very exciting progress by our organization in that area.
Look, it's been a spectacular year for Salesforce, for our customers, our partners, our employees. We're looking forward to being the 1st enterprise cloud community to achieve more than $5,000,000,000 in revenue this year. And before I close, I do want you know we're out on tour again. We have our Salesforce 1 World Tour. You may have come to see me.
Harvey kick that off in New York. You can come to Philadelphia on March 6 at the Pennsylvania Convention Center. You could come to Melbourne on March 26, Boston on April 2, Chicago on April 24, London on May 22, Amsterdam on May 27, Washington DC on May 29, Atlanta on June 12, Toronto on June 25, Paris on June 26. I'm going to be really busy this year, but we've got a huge message to get out there that the world is going social, it's going mobile, it's going cloud and it's getting connected that it's an Internet of customers that behind every app, behind every device, behind everything, behind the Internet of everything is a customer. And if you can connect with that customer in a whole new way, you can have the same great success with your business that we're having with our business.
And we wish that for all of our customers. This has been a banner year and I'm absolutely thrilled to do that. And I want to just say, Graham is about to give his comments. And Graham, your contribution to the company success over the past 6 years can't be overstated. It's been amazing.
And we're announcing your retirement on the call. You're going to be leaving the company a little bit more than a year from now in March of 2015. That's something that you and I have talked about for some time, something that you want to do and I respect very much because you've just delivered phenomenal success for us and you're leaving our company in an incredibly great financial position and we're thrilled to have one more exciting year for you coming up. We'll be sorry to see you go, of course. And we have a world class set of financial professionals who work so closely with Graeme.
But Graham, you're a phenomenal CFO. So thank you for everything. Thank you, Mark. Well, yes, it's we are going to have an epic 2015. And so that's a great hopefully going to be just a fantastic year to finish my spell here at Salesforce ON.
Before I get into that, let me just spend a little bit of time on the financial details. As Mark described, we had just a great year at Salesforce. We closed the largest acquisition in our history. We launched our Salesforce 1 platform and we added a number of industry leading executives to the team. And our financial results this year were just outstanding with strong growth in revenue, deferred revenue and operating cash flow.
We saw strength across both our Enterprise and Commercial businesses and ExactTarget posted just a terrific finish to the year. In addition, we achieved a new milestone of customer success with attrition dropping to record lows. I'll give you a little more detail on that in a second. Let me take you through the highlights of the quarter and the year starting with revenue and EPS. So 4th quarter revenue was $1,145,000,000 that's up 37% over Q4 last year.
If you exclude the FX headwind of approximately $3,000,000 Q4 revenue is actually up 38%. ExactTarget contributed approximately $96,000,000 to revenue in the 4th quarter, which was higher than we expected. Non GAAP EPS for the 4th quarter was 0 point 0 $7 $7 that was a penny ahead of our expectations. Full year revenue was $4,071,000,000 that's up 33% over fiscal 2013, Excluding an FX headwind of approximately $24,000,000 full year revenue was up 34% year over year. An ExactTarget contributed approximately $194,000,000 to revenue for the full year.
Full year non GAAP EPS was 0 point 3 5 dollars Looking at Q4, year over year growth on a regional basis, Americas revenue grew 41% to $821,000,000 Revenue in Europe grew also 41% As mentioned, dollar attrition in the 4th quarter, now that's excluding ExactTarget, but dollar attrition on all our business excluding ExactTarget dipped below 10%. So it's a high single digit number for the first time. That's a new record low in the history of the company. So just an amazing result for us to finish the year. Turning to margins.
4th quarter non GAAP gross margin was 80%, while our Q4 non GAAP operating margin was 6 0.9%. For the full year non GAAP gross margin was also 80% and our non GAAP operating margin was 3.9%. The reduction in our full year margins reflect the acquisition of ExactTarget as well as the Oracle license agreement we signed during the year. Our Q4 operating margin was further impacted by the occurrence of Dreamforce in November, whereas last year Dreamforce was included in our Q3 results. Turning to hiring, we added more than 500 people in the 4th quarter and more than 3,500 new employees in the full fiscal year, bringing our total headcount to just over 13,300, that's up 36% over the last year.
Turning to the balance sheet, we ended the year with approximately $1,300,000,000 in cash and marketable securities, that's down from approximately $1,800,000,000 last year. Accounts receivable was up 56% over last year to approximately $1,400,000,000 The 3rd revenue ended the year at $2,500,000,000 up 35% over last year, including approximately $99,000,000 related to ExactTarget. Excluding approximately $8,000,000 of year over year FX headwind, deferred revenue increased 36%. On a sequential quarter basis, deferred revenue also had an FX headwind of approximately $8,000,000 Deferred revenue continued to benefit from the residual effects of multi year invoices and from the continued shift toward annual billing. The combined benefit to deferred revenue in Q4 was approximately $75,000,000 up from $67,000,000 sequentially, but down from $125,000,000 in Q4 last year.
As we mentioned in Q3, given the declining impact from the shift to annual invoicing, we initiated actually over 2 years ago now, this will be the last time we provide a specific dollar impact on deferred revenue. However, we do plan to continue to provide the proportion of annual invoices issued in the quarter. Excluding ExactTarget, approximately 83% of the value of all subscription support related invoices were issued with annual terms in Q4. That is compared with approximately 80% in Q4 last year. And for ExactTarget, we were really pleased to see improvements in their mix of annual billing in Q4, which increased approximately 10 points over Q4 last year.
So great progress there. Unbilled deferred revenue or revenue that is contracted but not yet invoiced and is off the balance sheet was approximately $4,500,000,000 in Q4. That's an increase of approximately 29% over last year. Turning to cash flow. Q4 operating cash flow was $271,000,000 down 4% over Q4 last year, but actually above our expectations.
And for the full fiscal year, operating cash flow was $875,000,000 up 90% over fiscal 2013. It's a very strong result when you consider that ExactTarget reduced our full year operating cash by more than $50,000,000 during the year. CapEx was $70,000,000 in the 4th quarter, up 38% year over year and $299,000,000 for the full year. That's up 70% over last year. The year over year increase in CapEx was principally related to new office build outs and to a lesser extent exact target.
CapEx as a percentage of revenue in the 4th quarter was 6% unchanged from Q4 last year. Free cash flow, which we define as operating cash flow as CapEx, was $201,000,000 in the 4th quarter, down 13% from last year. For the full year, free cash flow was 576,000,000 dollars up 3% over fiscal 2013. Turning to guidance. With our strong finish to fiscal 2014, we are delighted to be raising our full year 2015 revenue outlook by $100,000,000 to $5,250,000,000 to $5,300,000,000 And that gives year over year revenue growth range of 29 percent to 30%.
And as you've heard from Mark and me, we are committed to improving our non GAAP margins. We expect full year non GAAP EPS in the range of $0.48 to $0.50 which implies an increase in our non GAAP operating margin of 125 basis points to 150 basis points. And that assumes no significant M and A activity during the year. Our FY 2015 non GAAP EPS also assumes that other income expense will continue to be a net expense and we're also assuming a non GAAP tax rate of 36.5%. We've made some changes to our non GAAP tax forecasting.
So let me just spend a minute to provide some color on that. In an effort to provide more consistency for guidance and reporting purposes, we will be we'll actually begin using a fixed long term non GAAP tax rate, in this case, 36.5%. This non GAAP tax rate eliminates the effects of non recurring and period specific items, which can vary and have certainly varied in size and frequency. We will provide updates to this fixed rate annually or if a situation arises that causes significant change to our assumptions around the projected rate and continue to provide a reconciliation of our GAAP to non GAAP tax rate in the detailed financials under income tax effects and adjustments. For fiscal 2015, we expect operating cash flow to grow in the mid-20s percent range and expect CapEx to be approximately 5% to 7% of revenue in line with historical averages.
Turning to Q1, we anticipate revenue in the range of $1,205,000,000 to $1,210,000,000 representing year over year growth of 35% to 36%. We expect non GAAP EPS in the range of 0 point $9 to 0 point 10 dollars and we expect Q1 deferred revenue growth to be in the low 30s percent range. During the Q1, we are committed to repay in cash an aggregate principal balance of more than $280,000,000 related to conversions of our $575,000,000 75 basis points senior notes, which we issued in January just 4.5 years ago, so they're due January 2015. And we'll likely see continued conversions during fiscal 2015, which will have an impact on our cash flow as well as our financing cash flows, balance as well as our financing cash flows throughout the year. As a reminder, all of the underlying assumptions for our GAAP and non GAAP guidance and a complete GAAP to non GAAP reconciliation can be found in our earnings press release issued today.
Before moving on to Q and A, I want to briefly address my future retirement that Mark talked about when we announced today. I could not be more convinced of salesforce.com's long term success. This year, we will celebrate our 15th anniversary and also pass our 10th year as a public company. And I'm sure the next decade we'll see salesforce.comgrow to be one of the very largest software companies in the world. And I've really enjoyed being part of the Salesforce team for the past 6 years and I want to thank everybody who I've worked with both within Salesforce and our advisors for helping me and the company be so successful.
And I look forward to helping the executive team with the CFO search process and obviously ensuring a very smooth want to come back and just say, Graham, thank you so much for your contribution to our success over the last 6 years. I really can't overstate what you've done to the company. And when you're with this retirement, you're going to leave an unbelievable legacy. And I couldn't be more grateful. So thank you very much.
And Graham will be speaking next week at the Raymond James conference in Florida. So come and see Graham there. And I will also be speaking at the Morgan Stanley Conference here in San Francisco on Tuesday at 12 p. M. To 12 40 and I'll be also joined by our Chief Accounting Officer, Joe Allinson.
So please come and see me and Joe on Tuesday. All right. And so with that, I'll turn it over to questions. Thank you very much. Graham, if
you're looking for career advice on what to do next, I highly recommend sell side equity research. But Mark for you, can you talk more about the platform? Obviously, you launched Salesforce 1 with a mobile centric approach to the market. Can you talk about some of the largest transactions that the company is pulling down, especially post Salesforce 1? And how does the composition of your business look 2 to 3 years from now vis a vis how big sales cloud and service cloud are relative to platform?
Thank you very much. That's it for me.
Well, I really appreciate that question because it's really the heart of our strategy and something to where I've spent a huge amount of my personal time this year getting Salesforce 1 right. You know cash because you follow enterprise software so closely that I don't think there's any company whose enterprise software has moved as well as ours has to the phone. And not only do we have a compelling mobile experience for our sales, service and marketing clouds, but you can also build your own custom applications and deploy whatever you need to automate your company right onto the phone. And as an ISV, you can also publish right into Salesforce 1. It looks a lot like Facebook or Twitter does on an iPhone or an Android, but you're running your business and we're the first ones there.
It's a huge competitive advantage for Salesforce. It's a critical part of every sales cycle and we're moving into a phone world. Said this on the call before, I strongly believe in the future of the phone. I think phones are getting larger, faster and that your software has to run really well on the phone and ours does. And perhaps only ours does.
I think that's certainly true today. I don't know if how long that will be true for, but I haven't seen anyone else really deliver a vision of enterprise software on the phone. On my phone, I can manage my feed, I can manage all of my groups, all of my employee information, my analytics and dashboards, my schedules and all the critical ISV apps as well that I use as well as custom apps. I mean at Salesforce, we have just some really great apps that we've deployed internally that are accustomed to us everything from managing our IT trouble, tickets to even giving feedback on Salesforce 1 to create a task for our customers for life organization and it's a heart of everything we do. Now we've got a lot of horses in the race here and we're not a single product company anymore.
We are a multi product company and we've got many products, sales cloud is certainly a phenomenal success story, it's a multi $1,000,000,000 product line and Service Cloud is incredible. Marketing Cloud, you know what those numbers are and you see that growth rate platform is right there. So we've got 4 incredible product lines and that's our focus today. The sales cloud, the service cloud, the marketing cloud and the platform. And it's certainly our goal that each one of those are multibillion dollar products.
That's our strategic direction. And we're very focused on the strategies, the communication, the branding, the acquisitions necessary to make sure that those four things are all multi $1,000,000,000 products. And there aren't that many companies in our industry who've been able to deliver that kind of multi product success, but we have. And we have a clear strategy. And those are kind of the 4 legs of our stool and we're going to continue to execute on that.
And we believe that the customer is the heart of that strategy that we have everything necessary to connect with the customers in a whole new way. And for these customers who are signing these huge deals with us, with Salesforce 1 as the core platform, with this sales service marketing platform strategy, we've got the right story and we have the right solution. And you can go to the App Store or Google Play Store right now and download it and use it and try it and you can see it's phenomenal.
Your next question comes from Keith Weiss with Morgan Stanley.
Excellent. Thank you guys. And Graham, it's been a pleasure working with you over the past 6 years. And I'm going to direct the question in your way. The reduction in the attrition rate to under 10% is a great accomplishment.
I think it talks a lot about sort of the stickiness of the salesforce.com solution and increasing strategicness of solution, but I think it also talks to sort of the operational controls that you guys have put in place. The question after that is, do you think there's room for further improvement in that as your product offerings get more strategic and maybe from an operational perspective to get that attrition rate even lower?
Yes. Thanks. We are obviously delighted to see that rate finally drop below 10%. It feels like I think it's 18 quarters or it's been a long journey, but I think there's certainly still room for improvement. And I think we've talked in the past about the different programs we have, the early warning systems we have, the shift to enterprise.
And I think clearly bringing in the new leadership team with Keith Block and Tony Plunkettler certainly, I think, added to that just absolute credibility in the enterprise space. And we frankly see very, very low attrition rates in enterprise. And so for us, I think it's a lot more about working on the mid market and small business. And I think you'll see us continue to do that. I don't think you should expect you've seen the rate of decline has been slow and steady.
And I think we'll be working hard basically keep that going over the next few years. I don't really it's impossible for me to give you a credible forecast, but I think it certainly can go lower over time if we keep working at it.
Your next question comes from Mark Murphy with Piper Jaffray.
Yes. Thank you very much. Mark, when you consider how the marketing battle is developing and in particular as it relates to Adobe, how are you thinking about some of Adobe's competencies including content management and website analytics? And also, how do you think Adobe and maybe Oracle feel about trying to take on Salesforce's dominant leadership position in some of the areas that are going to be so synergistic to marketing? In other words, the sales cloud and the service cloud, do you think it's really feasible to try to become a system of engagement if you don't own those assets?
Well, I love Adobe. I mean, I've used their products since I was at Apple and they created a postscript for the laser printers. And those founders who still guide that company are 2 of the most visionary people, I think, in the industry. And it's a great organization. And they obviously participate in the marketing market and so do we and so do others, because it is a big market.
And as we said, CMOs are going be spending more on technology than CIOs. And I think that this is not a zero sum game. I think there's plenty of room for everybody. And I've been investing, as you probably know, for the last couple 2 or 3 years now, because we believe so strongly in this and we bought quite a few assets and tried a lot of different things because we had to kind of find our way through this opportunity and we certainly have done that. And you can see, we bought the premier asset in the market last year.
There's just no question. We're number 1 in email marketing. We're number 1 in social listening. We're number 1 in social publishing. We are number 1 in social advertising with social.com, which is the number 1 provider of services to advertisers on Facebook.
I think it manages about 10% of Facebook's ad spend approximately. And we just see a lot of potential going forward. One of the most exciting things with ExactTarget is the complete concept reconceptualization of their product into Journey Builder. And for those of you who have seen us now demonstrate that it's a think we also ended up with phenomenal asset called R Dot, which was actually a huge part of the quarter. It was one of the absolute fastest growing products we've ever seen.
It's tightly integrated with our sales cloud and will be even more tightly integrated. It competes in that lead nurturing marketplace and that's another area. There's a lot of different places to play in marketing. And I think that we are absolutely a player in marketing. I think one of our key assets of course is our large and extremely well run direct sales organization and also that customers want that marketing cloud to be tightly integrated with what they're doing with sales and service.
But I want to make it clear, I really think that there's plenty of room here for everybody. There's a lot of great companies out there. Dolby is a great company. And we're going to be the number one marketing cloud in the
world. Your next question comes from the line of Raimo Lenschow with Barclays.
Thank you. It was great working with you and maybe don't listen to cash on the career advice. Quick one. This quarter we saw a big increase in large deals. Can you talk a little bit about the drivers there?
How much of that was Keith Block already? And how much can we expect more from him? And how much was it customers buying into division of Salesforce in terms of Salesforce 1 and the Exane product? So just kind of help us this kind of the beginning of a trend that will continue. Thank you.
Well, thank you. And I think if you look at large deals for sales force, they do tend to be quite seasonal. It's the end of our fiscal year. Our sales reps tend to architect their own compensation plans to culminate in a large transaction at the end of the fiscal year. It's kind of the nature of the enterprise software business.
And if you go back and look at, we tend to report at the end of every year the number of large transactions in the Q4 that occur, I think you'll see that we've just had really good symmetrical growth of our large transactions, but also our small and medium transactions as well, we run a full portfolio of business, a full portfolio of geographies, the large enterprise business is important, the small business is important, the medium business is important. We have a complex distribution organization, which is why we're so fortunate to this year attract a great leader, Keith Block to run that for us. He's also a member of our Board of Directors and he's done a great job. He's hired a great management team And we couldn't be, I think, better positioned for continued excellence in distribution. And Raimo, just a reminder on the numbers.
So we reported more than 207 and 8 digit transactions this quarter. Q4 a year ago was over 150. So that more or less mirrors that growth rate in the 30% plus range. So as Mark says very kind of symmetric growth. And I think that that's really the most important thing because as the CEO, I want all aspects of the business to be growing with equanimity and that we don't leave any one segment or any one geography behind, because the strength of the company and the reason why you see Salesforce delivering a 37% growth opportunity here is because we manage that full portfolio of revenue.
We've talked about that on a number of calls. But we've done that very well and that's a key part of our strategy. And I don't like to overemphasize any one area, but in the enterprise, like I said, I don't know any other company that got close to more than 200 transactions in the 7 and 8 digit category in customer relationship management enterprise software this quarter or any quarter before this.
Your next question comes from Heather Bellini with Goldman Sachs. Great. Thank you. Congratulations. And yes, Graham, I echo everyone's thoughts and you'll definitely be missed.
My question, Mark, is I guess I had 2 questions, one for Mark and one for Graham. Mark, how do you think about the integration of your marketing cloud assets and how important will the ultimate integration of these assets be to further inflecting the growth that you're seeing in that cloud to kind of get to the vision that you're talking about a few years down the road? And then I've got a follow-up for Graham.
Well, thanks Heather. As usual, I think that your question is actually something that is very relevant for where we are right now. And I'll tell you exactly how I think about this. In the marketing area, some parts need to be very deeply integrated and some parts can be loosely coupled. And in the deeply integrated area, lead nurturing, for example, with Pardot, if you go to pardot.com and you go to pardot.com and you look at the website, you look at the integration that we are have done so far, I think between now and Dreamforce, you'll see an extremely deep integration between Salesforce and Pardot.
And we continue to scale that business and grow it and make sure that it's integrated extremely deeply to our core. With ExactTarget, that unit is more loosely coupled because many of the key areas that it focuses on do not need to be as deeply integrated as the Pardot asset. Still, we can have shared contacts, we can integrate our service cloud, we can bring in our consoles. But at the end of the day, I believe that those marketers are going to want a control panel to build to run their business and I believe that that's going to look a lot like ExactTarget. You can see how we've already integrated Salesforce core services and Salesforce platform with Journey Builder.
You're going to see more things like that. And it's just a very, very exciting time for the marketers. And you won't hear me say enough that I think we have the premier platform and we're going to continue to see some real excellence out of ExactTarget in our Indianapolis
team. Okay, great. And just a follow-up for Graham would be, Graham, I might have missed this, but could you give what ExactTarget did for deferred for the quarter?
Yes. It was $99,000,000 right? Dollars 99,000,000 Thank you.
Your next question comes from Ross MacMillan with Jefferies.
Thanks a lot. And Graham, congratulations on your time at Salesforce and all the very best for when you do ultimately leave the company. Mark, I had a question also on platform, which I guess is with the success you're seeing with Salesforce 1, does that change your view on the timeframe on which the platform could get to $1,000,000,000 of ARR? And does it change your view on the platform addressable market? Thanks.
Well, I think Salesforce 1 is an accelerator on the platform. I also think that Heroku is an accelerator on the platform. I think Fuel from ExactTarget is an accelerator platform that these three things together really make a phenomenal platform. I couldn't be more excited with Salesforce 1 how it is going for our customers. As I said, our own success with that inside the company speaks to what it can do for our customers, to our ability to compete in the market, to differentiate ourselves, to make our customer successful in the phone environment.
We are all in on iOS. We're all in on Android. It's great on phones. It's great on tablets. And I know that it's got a lot of upside.
If you haven't followed the success of Heroku in the Ruby world, since we acquired that asset, it's been a rocket ship and that continues to be a huge part of our message to developers, especially in building interaction applications. We saw some great stories, especially in the enterprise this quarter with Heroku. 1 very large retailer, I don't want to get into the details, because I don't if we have approval to use their name or not, needed in a crisis situation to rapidly deploy a very large that one of the real assets of ExactTarget is that it's not just an app, but it's a platform and they very much have our strategy is integrated with a lot of key ISV apps and it's that trifecta of Salesforce, 1, Fuel and Roku that just give us 3 tremendous platform assets to really go after any task in building a custom capability for the customer.
Your next question comes from Brent Thill with UBS.
Graham, congrats on a great run. Mark, Keith spoke at Dreamforce about the transition to vertical engagement with customers. And I know earlier you'd mentioned you didn't want to go more vertical
with the product. But can
you just talk about this progression and the potential change in strategy and how do you think this impacts your engagement in the field with customers?
Well, I think it's a very important strategy. It's actually a strategy that we've executed in the company, but that Keith is definitely emphasizing. And customers by segment want more value from us and want us to be able to speak to them in their own language, to be able to bring value to them, to bring systems integrators. And I think a great story is our tremendous success in the pharmaceutical area with VIVO. You can see that's been very much one of our key focuses, making sure that we have a dominant position in pharmaceutical.
We have a key ISV that we've worked with there and it's been a great story. You talk to those big pharmaceutical companies. Well, that's a model for us for other industries. We want to align ISVs. We we can create success by vertical.
I think Keith has a vision and clarity around that that's even bigger than we had before came here and we're letting him run that with all of his gusto.
Your next question comes from Brad Zelnick with Macquarie.
Thank you very much. Graham, not only would I be an outlier if I didn't echo the sentiment of my peers, but I truly mean it and I wish the best and congratulations on your achievements. Mark, question is for you. Can you talk about what you're doing with EdgeSpring? And specifically, when it comes to big data and in memory analytics, how much of an opportunity is there to embed these capabilities into your existing clouds versus a separate distinct analytics cloud?
Well, thanks for that question, because I am a huge believer in big data and I'm a huge believer in analytics and reporting dashboards and you'll see with Salesforce that probably the most undercovered, underreported story at Dreamforce is what we delivered in analytics and reporting. A lot of that with some of these great new leaders that we acquired this year. And if you go and take a look at what we could do for customers today with our new next generation reporting engine, next generation dashboards, I don't think there is a company that delivers more dashboards and more reports and more analytics to customers every day than Salesforce. I haven't seen it. We are I know that in my own case, as I said in my story, January 31, I'm in Arizona at a dinner, it's a great dinner.
And but I want to know how the quarter is doing and I am just able to look down and glance at my phone and I've got incredible real time analytics happening and dashboards and reports and I know exactly what's happening with the quarter. And I think every CEO, every head of sales, every head of service, every head of marketing, manager, mid manager needs that same capability and we're delivering that in a social world, shows up in my feed, in a mobile world, it shows up in my phone, in a cloud world, it shows up which is why we've made these investments. And I think that if you go and look at what we've already delivered, you'll be hugely surprised and you'll see the emergence of some great new capabilities in Salesforce.
Your next question comes from Brendan Bonacel with Pacific Crest.
Thanks so much. Mark, I wanted to ask a follow-up to Brent Thill's question. As you move more into the verticals and the sales force, how do you make sure that you're not perceived as some sort of threat to the next generation of VIVAS and vertical specific vendors that might want to build on the platform?
Well, I really appreciate that. And when there's an ISV or there's someone building on our platform, we want to invest in them and partner with them. We've been a very partner friendly organization. We have a huge investment fund. I think it's probably one of the largest investment funds in the industry.
We don't talk about it or brand it. But I can tell you that we invest and we've had great returns. I just reviewed our investment fund returns. And we invest in cloud computing companies that are building on Salesforce and on our platform and we want to help these ISVs be successful. We want to give them the seed capital.
We want to give them growth capital. We want to help them with distribution relationships. We want to help them with their marketing, with their branding. We want to partner closely with them. And we've got some great success stories.
We mentioned Visa. I'm sure you know ServiceMax, I'm sure you know Canandy, I'm sure you know FinancialForce, I'm sure I mean, you go to the AppExchange and look under native and look at all the native apps that are there and you'll see that we're investing in those companies. And that one of the reasons they're getting growth is we're aligning to make them successful. We want those native app providers to be successful and we want to partner with them and we want them to grow and be a core part of our vertical strategy, absolutely.
Your
Your next question comes from Phil Winslow with Credit Suisse. Hi, congrats guys on another fabulous quarter. And again, Mark just like you said, Vyanda, he tweaked as a customer behind it, a great CEO. There's a great CFO. So congrats on your guys' partnership.
And here's another year of it. But my question is, Mark, on the Service Cloud. A lot of time has been spent on Mark and platform. Wondering if you could touch on just what you're seeing there in terms of trends across both Service Cloud actually and desk.com? And just what are you seeing competitively out there?
Thanks.
I think customer service is absolutely one of the most exciting areas. I mean, it's a big investment area for us. We believe that there is huge opportunity in the enterprise, huge opportunity in the mid market, huge opportunity in the small market where we have a lot we have desk.com, which if you haven't seen the new version of desk that we just released a few weeks ago, it's doing incredibly well. And we're continuing to invest in the success of desk.com, which was an acquisition that we made over a year ago. And we also have our Service Cloud, which was an acquisition that we did about 5 years ago.
The leader of that company called Instranet that was based in Paris is now the Head of our Product Organization, Alex Dayon. And he's done a phenomenal job building that product. And I'm very excited about service, but I love all of my children. I love the sales cloud. I love the service cloud.
I love the marketing cloud and I love the platform. And I love all of our partners too. So all of our ISVs, I would say. I guess that would be the first the 5th thing. I probably don't talk about that enough.
Hey, Christy, we have time for one more question.
Your final question comes from the line of Samad Samana with FBR.
Hi, good afternoon. Martin, Japan had the best constant currency quarter in a while after struggling in the prior few quarters. Were there any particular strategy changes that drove improvement? Or was it just a better demand environment in that region? And then as a follow-up to that, how penetrated is the core sales cloud outside of the United States?
Yes. Well, I think that I'll answer part of this and then I'll turn it over to Graham. I really think international remains a huge upside opportunity for Salesforce. We've invested very heavily in the United States market, which was a very good decision because it is the mega market for enterprise software. We really only do business in a few countries.
We do business in the United States, in Canada, in the United Kingdom, France, Germany, all which also performed really well this year. Europe had a great year. We did business in Japan. That's been a great story for us. We just moved into their new headquarters in Japan, invited by the government to move into the JP Tower, the Japan Post Tower, which is a brand new tower in the Maruchi District.
And we do business in Australia. And that's basically it. So we have a lot more internationally, but we have a lot of opportunity in a lot of areas. And so every time a dollar comes up for investment, we debate it very closely here, where are we going to put it internationally, in a city, in a country, in a product, because in our industry, there is a lot of opportunity for growth and we've been very fortunate to place those dollars correctly and you saw a great outcome here on this fiscal year delivering a 37% growth quarter and a 33 percent year. And that's and then the question is, okay, how much more are we going to put in all these various pieces?
Graeme, do you want to Yes. I just want to remind people that obviously Asia Pac is not just Japan, it's Japan and Asia and Australia and New Zealand. And certainly we saw a little better sort of executions in Japan and Australia in the Q4. So I think that's really what's helped lift that constant currency growth rate a bit in the 4th quarter. Great.
Thanks. Well, thank you very much. And again, I want to just come back before we do end this call. I want to just come back to Graham and thank you again for your great contribution to the company over the last 6 years. We're looking forward to working with you for the next 13 months.
So I know you're not going anywhere, but we just we want to signal it now so that we have an orderly transition of power. Many of you follow the sales force know that Graham was not our first Chief Financial Officer. He's our 3rd and he's absolutely done a phenomenal job. And as we've gone through these CFO transitions before, we know that investors want to have a lot of And so that's why I'm so thrilled to be able to talk about this today with Graham. Great.
Yes, Mark. It's been just amazing experience as I said. And I can assure everybody, I'm going to be working just as hard over the next 13 months to make sure that everything goes right. And I'll be making sure of that as well. So don't worry about that.
And I want to thank everyone for all their support for this fiscal year. We look forward to seeing you next week at the Raymond James Conference or at the Morgan Stanley Conference. And please come on the road with us. We've got a great tour coming up and come and see us in Philly, come and see us in Melbourne and Boston, Chicago, London, Amsterdam and DC, Atlanta, Toronto, Paris. We got many more come and meet our customers, our partners, come and see Salesforce 1 in action and get ready for Dreamforce because the Dreamforce is coming in October only a few short months away, the world's largest and most important technology show in the world of cloud computing and social and mobile and enterprise software coming back to San Francisco and we're going to have another incredible dream for us this year as well.
So thanks everybody and we'll see you next quarter.
This concludes today's conference call. You may now