Good day, ladies and gentlemen. Thank you for standing by. Welcome to the CRM Q3 Fiscal Year 2019 Earnings Conference Call. At this time, all participants are in a listen-only mode. Following management's prepared remarks, we will host a question and answer session. Instructions will be given at that time. If during the conference that you require operator assistance, press star then zero, and an operator will be happy to assist you. As a reminder, this conference call is being recorded for replay purposes. It is now my pleasure to hand the conference over to John Cummings, Senior Vice President of Investor Relations. Sir, you may begin.
Thanks so much, Brian. Good afternoon, everyone. Thanks for joining us for our fiscal third quarter 2019 results conference call. Our results press release, SEC filings, and a replay of today's call can be found on our IR website at www.salesforce.com/investor. With me on the call today is Keith Block, Co-CEO, Marc Benioff, Chairman, Co-CEO, Mark Hawkins, President and CFO, Bret Taylor, President and Chief Product Officer. As a reminder, 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. Some of our comments today may contain forward-looking statements, which are subject to risks, uncertainties, and assumptions. Should any of these materialize or should our assumptions prove to be incorrect, actual company results could differ materially from these forward-looking statements.
A description of these risks, uncertainties, assumptions and other factors that could affect our financial results are included in our SEC filings, including our most recent report on Form 10-K. With that, let me hand the call over to you, Keith.
Thank you, John. Thanks, everyone, for joining us today. As you can see from our results, we had another great quarter as we continue to deliver strong growth, customer success, and execution at scale. Revenue in Q3 was up 26%. Given the strength of the quarter and our outlook for Q4, we are raising our FY 2019 full-year revenue guidance to $13.24 billion at the high end of the range. This represents 26% growth this year. Obviously, we are very, very proud of the quarter and momentum in our business and our leadership position in the market. We're also initiating revenue guidance for FY 2020 at $16 billion at the high end of the range, representing 21% growth for the year and demonstrating the incredible demand for the solutions only Salesforce can deliver.
We are clearly executing on our vision of transformation and success for our customers, and we are doing it at scale. Every company in the world has a mandate to digitally transform its business. We continued to see this in Q3 with strong performances across every industry, every market segment, and every geography. We grew 25% in the Americas, 26% in APAC, and 31% in EMEA in constant currency. Since Dreamforce at the end of September, I have traveled around the world meeting with more than 100 CEOs and world leaders. The conversation is consistent everywhere I go. It is about digital transformation, it is about leveraging our technology, it is about our culture, and it is about our values. This C-level engagement is translating into more strategic relationships than ever.
In fact, in Q3, the number of deals generating more than $1 million was up 46% over last year, and the number of $20 million-plus relationships we have continues to grow significantly. In fact, in the quarter, we renewed and expanded a nine-figure relationship with one of the largest financial services institutions in the world. We are very excited about this. As you know, an overwhelming majority of our revenue is multi-cloud. Customers like DuPont, Citi, Uber, many others, they are all driving more meaningful relationships with their customers across sales, service, marketing, commerce, integration, and more. I was recently in Australia, where I met with dozens of government officials and CEOs across several industries. Many are being challenged by disruption, and all agree that being closer to their customers and citizens is critical to their growth and their success. This is not unique to Australia.
Digital transformation is a global phenomenon. We had a great quarter in EMEA, where we strengthened our relationships with Deutsche Telekom, Engie, Dyson, and KONE. In APAC, we expanded with Telstra and Bajaj Finserv and formed a new relationship with MLC Life Insurance. In Japan, we expanded with heavy industrial manufacturer IHI as one of the world's leading auto manufacturers. Our industry strategy, which is all about speaking the language of the customer, continues to drive exceptional growth. Our strong momentum with Financial Services Cloud continued in Q3. As I mentioned before, one of the largest financial services institutions in the world selected Financial Services Cloud, as well as Einstein. Mutual of America Life Insurance also selected Financial Services Cloud, and they are leveraging Salesforce Einstein to improve their go-to-market strategy and customer engagement.
Pentagon Federal Credit Union, with nearly 2 million members, is also going all in with Financial Services Cloud, as well as Community Cloud, Einstein, and MuleSoft to deliver a best-in-class member experience. The Salesforce Platform now powers mission-critical applications across the Department of Veterans Affairs, while Service Cloud helps ensure veterans can reach a live support agent 24 hours a day, 365 days a year. Very important for those folks. We also expanded with a branch of the United States Armed Forces to transform how they engage with the service members from recruitment to retirement. With Health Cloud, we formed a new relationship with WorkSafe Victoria in Australia, and we expanded our existing relationship with Alcon, one of the world's leading eye care and medical device companies.
Partners, which are so critical to our growth, they continue to expand our ecosystem, which extends the power of our core offerings. At Dreamforce, we added Apple to our roster of strategic partners, which we're very excited about. That roster includes Amazon, Google, IBM, and others. This quarter, our SI partners were engaged in 64% of our new business globally and continue to invest in their Salesforce practices. Global partner certifications are up 26% year-over-year. That's the 19th consecutive quarter that our partner certifications have grown by double digits. Finally, we continue to execute again and again with our proven integration model. As a result, we're already seeing great returns from our acquisitions of MuleSoft and Datorama and CloudCraze. Speaking of MuleSoft, integration has become a strategic imperative for all of our customers.
It has captured the attention of C-level executives in virtually every conversation I have. In the quarter, companies like Ahold Delhaize, WeWork, Michaels Stores, and it continues, just love MuleSoft because MuleSoft is able to unlock data from legacy systems and accelerate their digital transformations. In closing, we are thrilled with our results and our strong momentum heading into Q4 and FY 2020. It's been an outstanding year to date. We are well on our way to achieving our goal of $21 billion-$23 billion in revenue in FY 2022, faster than any enterprise software company in history. I want to thank our customers, our partners, and employees for their trust and continued support. I also want to take a moment to thank the firefighters and first responders who have courageously battled the wildfires here in California.
Our thoughts remain with them and all of those who have been affected by these terrible events. With that, I will turn the call over to Marc.
All right. Well, thank you so much, Keith. Before I start, I do want to just come back to that and thank all of the first responders and everyone who's worked so hard over the last two weeks. We've had a terrible tragedy here in Northern California. Also one in Southern California. Certainly here during the holidays, 14,000 families have lost their home, 500 businesses. Half of all first responders lost their home in the fires. It's been a terrible disaster here. Obviously, we had a terrible fire last year. This one is even worse. It's our worst ever in Northern California. All of our hearts are with the victims and their families. Also all of our gratitude is with the first responders.
We had a city here filled with smoke for a couple of weeks, that smoke just reminded us how connected we are, not only to each other here in San Francisco, but all the way up to Butte County. Our hearts remain with them during the season. I really want to thank not only our employees, but also customers, many of whom came to our lobbies here where we filled supplies up, brought them up to Butte County and distributed gift cards. Many of our customers who are retailers helped us procure gift cards for first responders as well as for the families in Butte County. I want to thank them, we're going to continue to work on that.
It is still on our mind, we're also giving $2 million initially to these relief efforts, all of us at Salesforce are going to continue to stand with our neighbors and the communities across California as we're rebuilding. Thank you for letting me just talk about that for just a moment, because it's been something that we've all gone through here over the last several weeks. Okay, now, with respect to the numbers, Keith said it, this was absolutely a fabulous third quarter. It was incredible. Obviously, we've given guidance for an incredible fourth quarter coming, I'm hoping that Keith is going to improve on that, even though the fourth quarter guidance is incredible.
Here we are at $16 billion for next year and only two years from our goal of $22 billion to $23 billion, which is amazing, that in fiscal year 2022, we have this vision. Thank you to our team and our Ohana for delivering these incredible results. It's just amazing and an incredible moment in history. We are all in this midst here, I just was talking to Jim Cramer, it's like, well, what is happening? This is all about the fourth industrial revolution. This is about the cloud. It's about artificial intelligence, machine learning, deep learning. There's so many technologies that are happening. I read this morning in the newspaper about CRISPR being used to genetic editing of twins in China. We are in a lot of uncharted territory here, we're going to continue to see incredible expansion.
When it gets right down to digital transformations, well, every digital transformation starts and ends for all of our customers with their customer. CRM has never been more strategic. You can see that in the growth rates for the CRM marketplaces. Remains the fastest-growing market segment enterprise software. That's a big change from when Keith and I started in the enterprise software industry, both started in 1986, it was all about other types of technologies that have been downplayed. Now it's all about the customer. It's about CRM. This is a big and exciting market. We're obviously the largest player. We have these incredible growth rates that we're putting up. When we look at other companies in the CRM marketplace, a lot of companies are doing very well because this is what it's all about. It's all about the customer.
Salesforce remains this global CRM leader. We're the number 1 CRM. We continue to take share and outpace the market. You can see that in our results as we're moving to $16 billion. This is because we're the only company that is dedicated 100% to CRM at this size and scale, and we're the only company with a complete Customer Success Platform for both these B2B customers and their B2C companies as well. For those of you who joined us at Dreamforce, I always look at that as the ultimate manifestation of our company and how we're doing. You saw the huge turnout, especially compared to some of our competitors. I'm not going to name any names because they're very sensitive. They get upset. Some of our competitors also had conferences recently and didn't have a big, huge turnout like this.
171,000 registered attendees, 10 million watched us online, largest Dreamforce ever. Probably everyone on the call was at Dreamforce. It was incredible. We saw these amazing companies, where Marriott and Brunello Cucinelli was here from Italy, and Unilever was here from the U.K., and everyone connecting with their customers in a whole new way. We also saw my friend on the right here, did an incredible new product. Bret Taylor launched his Customer 360. Customers blown away. Connecting all of our clouds together, giving our customers a single 360-degree view of their customers across every touch point, across Sales, across Service, Marketing, Commerce, but really thinking now, especially with MuleSoft, how do we give those customers that 360-degree view that they so badly want? That's why that's one of the biggest announcements we've ever made, and I hope Bret will talk about it later on the call.
Of course, you can see the acceleration in our business and also in our positioning and our relationship with our customers and MuleSoft, the number one integration cloud, giving customers extraordinary power of integration, bringing together vast amounts of data across all kinds of systems in this incredible API architecture. Always loved this company, and I love it more now as part of Salesforce. They're right here with us now in Salesforce Tower. Greg and his team just did an incredible job. We saw that not just at Dreamforce, but through the whole quarter. I think both companies are just hugely surprised at how well it's come together, but also their execution's dynamite. You also saw the release, again, Bret came up with this, with Parker, Einstein Voice. Amazing.
You saw these amazing demonstrations of voice, not just interactive voice response, but now Salesforce can actually parse the data and actually insert it correctly in the customer database automatically, so anyone can talk to Salesforce. Makes every employee and customer more productive, amazing. Einstein talking to Siri. Einstein and Siri are now friends. Hopefully, they're going to become best friends because we had Apple for the first time, strategic relationship. Something we've always wanted. At Dreamforce, amazing to have this great relationship with Tim Cook, probably the best executive in our whole industry. Thank you, Tim, for your leadership and what you've done, the relationship with Salesforce. We're very grateful to you. As we roll out these new mobile apps, our customers are expecting more innovation to come.
You also saw that we're strengthening our relationships with amazing companies in the cloud world, including Amazon and Google and IBM, delivering these incredible innovations. Our customers are just loving the amount of innovation that's happening in our industry, especially as the cloud becomes mainstream. At Dreamforce, we're thrilled to announce a new strategic partnership. Again, just expanding that capability and giving us that capability to have it not only with Amazon and Google, but Apple as well, and other companies. Okay. Let's talk about Einstein for a second. I told you Einstein was delivering 3 billion predictions and insights every day in the last quarter. Now a few months later, we are doing 4 billion Einstein predictions every single day, exceeding our expectation.
The transformation of all of our products to artificial intelligence, all of our products getting smarter, all of our products having Einstein built in, that Einstein is at the heart of the Customer Success Platform, making it more powerful and more capable every day. You look at the many layers of our Customer Success Platform. The center is the customer. Of course, everything is going in and out of Einstein, with Einstein making the customer smarter, being our partner every day. I know I use that. That's incredibly important to me. Surrounded by this full range of capabilities, whether it's Sales or Service or Marketing or Commerce or our Platform or integration or our Community or enablement or engagement. I mean, all levels of the Customer Success Platform has been made better by Einstein and then wrapped by this amazing Trailblazer community. Awesome.
We really saw it this weekend, I'll tell you, during Black Friday and Cyber Monday, of course, our customers have deployed this Customer Success Platform. You're wondering what's going on. I just got this amazing report. I can't talk about it because it's a public company that we're working very closely with who had this massive success over the weekend, and they're in the retail industry. I look at all these companies, and we're powering more than 20 million orders on the Customer Success Platform, double-digit growth. Amazing. One thing that really stood out for us was 50% of the orders are placed on the phone. Wow. Mobile traffic to retail sites reaching 67%. Obviously, that's a huge transformation that we've gone through, and our customers, especially retail customers, are going through that. I'd just like to touch base briefly now on our Trailblazers.
It's the outer ring of our platform. Our Ohana is so important to us, but especially our Trailblazers, and we've got a million of these Trailblazers who are empowered and enabled with all of this capability, and they're doing that on Trailhead. For those of you who've not been on trailhead.com, please get on trailhead.com. This is our free online learning platform. It's letting everybody go through the workforce development they need to get into the fourth industrial revolution, to have their place in the digital economy. This is center to our strategy.
You can see that because a quarter of these customers who are on Trailhead have self-reported that they have changed jobs because of skills they've gotten on the platform, the jobs they're getting are these phenomenal six-figure jobs. We're so excited for all of our Trailblazers, our goals are to get to millions and millions of these Trailblazers. We're really excited. We also saw that we have continued to get some great recognition. Of course, paramount to Salesforce is our culture. Keith and I work on that hand-in-hand every day. That's reflected in our core values of trust, of customer success, of innovation, of equality. Our culture is very important for those of you who've been to any of our towers around the world, whether it's here in San Francisco or Indianapolis or London or Tokyo or New York.
I can tell you can feel it when you walk in. The culture is so important to us, and we're trying to cultivate a great culture. Thank you, Fortune magazine, ranking Salesforce, again, as the number 1 best place to work in the world. That is not just true globally, but in so many of the cities also that we do business in. We've been called out by Fortune magazine. Thank you for that. That's so important to us. I also want to thank Harvard Business Review, called out Salesforce, obviously, they said top CEOs in the world, but really calling us out as number 6 top company in the world, Harvard Business Review, and number 1 American company for best performance for 2018. Thank you, Harvard Business Review. We're very grateful as well to you.
We saw this quarter how the two parts of our vision at Salesforce, changing the way the world does business and improving the state of the world, go hand-in-hand. At the Global Climate Summit in San Francisco, many of you were with us, Salesforce united with 21 other tech companies in the Step Up Declaration to decarbonize our companies. We realize it's more important. World Economic Forum says that by 2050, we're going to have more plastic in the ocean than fish. Who wants a plastic ocean? I don't. We're deforesting, losing one acre of forest every single second. Who wants a planet without forests? I don't. We need the forests right now more than ever. This was evangelized by Jane Goodall at the conference because of the carbon situation. We've got to improve our situation with our climate.
We've continued to focus with others in our industry to decarbonize and to improve our relationship with the climate. Onward to public education. Moving into the fourth industrial revolution, we've got to bring the kids with us. That's why we've now put more than $50 million in our local San Francisco and Oakland public schools. This is halfway to our short-term target of $100 million. Everyone knows that we are thrilled that San Francisco passed Proposition C. Amazing. Record turnout, incredible turnout of San Francisco's coming to the polls, realizing that we could do something together, which is passing Proposition C. Spoke to the mayor this morning, we are very excited moving forward with Proposition C.
The city will begin collecting the tax January 1st. Looking forward to getting that into the hands of the amazing NGOs that we have here in San Francisco, like Hamilton Families, like Larkin Street, like Glide, like Catholic Charities. Many people here who are helping our terrible, horrible homeless situation. We experience it every day being here. I know many people who live in cities in the U.S. are experiencing bad homelessness, and there's so many things that we can do. We learned so much during Prop C and saw so many great insights. The number one thing that every homeless person needs is a home.
At this time of the year, during the holidays, all of those homeless people are on our minds more than ever. Thank you for your strong support here in San Francisco. The largest and most successful businesses all coming out for the good of the homeless. Thank you to Twilio now for giving $1 million. Thank you to Airbnb for giving $5 million to homelessness. Since Prop C, others are now coming in to support the homeless situation. We plan for another major announcement this week regarding the homeless, so be on the lookout for that. It's another reminder business does not exist in a bubble. We're part of a city. We're part of a community. We're part of the Ohana. We're part of a planet, and we realize we're all connected.
We're all one, that our companies are only as strong as these connections in our communities. That's something that Keith and I are talking about all the time, how Salesforce can be a light unto the nations and be a beacon for others and show what is possible when business becomes one of the greatest platforms for change. With that, let me turn it over to our chief financial officer to talk about how the company did during the quarter. Mark.
Thank you very much, Marc. As you've heard, we delivered strong third quarter results as we continue to execute at scale. Third quarter revenue grew 26% in dollars and in constant currency, despite experiencing a year-over-year FX headwind to revenue of $15 million and a sequential FX headwind to revenue of $19 million. Now, MuleSoft contributed $128 million to total revenue net of purchase accounting adjustments. Looking at the year-over-year subscription and support revenue by cloud, Sales Cloud grew 11%, Service Cloud grew 24%, Platform and other grew 51%, including approximately $105 million of MuleSoft, and Marketing and Commerce grew 37%. Dollar attrition exited the quarter below 10%. Operating cash flow was $143 million, up 14% over last year. Third quarter OCF included our first bond coupon payment of approximately $44 million on the MuleSoft acquisition debt.
Unearned revenue ended the quarter at nearly $5.4 billion, up 25% in dollars and 26% in constant currency, with MuleSoft contributing approximately $103 million. Unearned revenue was impacted by year-over-year FX headwind of $34 million and a sequential headwind of $39 million in the third quarter. We've always said that unearned revenue can be lumpy due to invoice timing, renewal timing, duration changes, et cetera. We saw that in the third quarter, where unearned revenue came in a bit better than our guidance. This had the effect of reducing the quarter-on-quarter sequential decline in unearned revenue from Q2 to Q3 we have historically seen. This also has an impact on the sequential change from Q3 to Q4, which I'll discuss in a moment. Total remaining performance obligation, which represents all future revenues under contract, ended Q3 at $21.2 billion, up 34% over last year.
MuleSoft contributed approximately $300 million to the balance in the quarter. The current portion of the remaining performance obligation, business that's both billed and unbilled, and is expected to be recognized as revenue in the next 12 months, was $10 billion, up 27% year-over-year. Moving on to guidance. We came off a strong third quarter results. We are now once again raising our full fiscal year 2019 revenue guidance to $13.23 billion-$13.24 billion for 26% year-over-year growth. This guidance includes approximately $375 million from MuleSoft. We expect to deliver non-GAAP operating margin improvements of approximately 50 basis points at the high end of our prior guidance range, even while the demand environment gives us the confidence to continue investing in MuleSoft and other growth initiatives. We are raising our FY 2019 GAAP diluted EPS guidance to $1.06-$1.07, our non-GAAP diluted EPS guidance to $2.60-$2.61.
Keep in mind, this guidance does not take into account the possible future impact related to ASU 2016-01. We are maintaining our full-year fiscal 2019 operating cash flow growth guidance of 15%-16% year-over-year. As we discussed previously, this guidance includes a headwind of approximately $150 million related to our acquisition of MuleSoft. For Q4, we're expecting revenue of $3.551 billion-$3.561 billion, a GAAP diluted EPS of $0.08-$0.09, and non-GAAP diluted EPS of $0.54-$0.55. Turning to unearned revenue, we expect fourth quarter year-over-year unearned revenue growth of approximately 17%. This implies a sequential growth rate of approximately 52%. Let me take a moment to provide some additional context to this UR guidance.
First, the FX environment has changed significantly over last year, we now anticipate a year-over-year FX headwind to UR of approximately $200 million in Q4 versus an FX tailwind of approximately $130 million in Q4 of last year, for a $330 million FX swing year-over-year. Now that represents about five percentage points of growth. Secondly, as you may recall, in Q4 of last year, we had an extremely strong renewal quarter, including some of the largest renewals in history. This drove outsized growth in our billed and unbilled deferred revenue in Q4 of last year. Thirdly, and finally, as we discussed at the most recent Investor Day, the timing of invoices and renewals can impact the UR balance in any given quarter.
Third quarter's UR came in ahead of our guidance. As a result of this dynamic, which has a direct impact on the UR balance of successive quarters and the related sequential changes, as a reminder, this is the last quarter we'll provide unearned revenue guidance. That said, when we report our fourth quarter results, you will have two full years of data on the current remaining performance obligation, which we think is a more complete metric because it's contract-based versus invoice-based. Now, moving on to FY 2020 guidance. As you've heard from Keith, our demand environment remains very strong. As a result, we're initiating fiscal 2020 revenue guidance of $15.9 billion-$16 billion for a year-over-year growth of 20%-21%, keeping us on track to deliver our target of $21 billion-$23 billion of revenue in FY 2022, now only a little bit more than two years away.
We will provide our cash flow, EPS, and non-GAAP operating margin guidance for FY 2020 when we report our fourth quarter and full-year results in February 2019. To close, we delivered another strong quarter of results. We have great momentum as we look to close out the year. I want to thank our employees
Our customers, our partners, and our shareholders for your continued support. I wish you all a wonderful holiday season. With that, let's open up the call for questions.
Thank you, sir. Ladies and gentlemen, at this time, if you would like to ask a question over the phone, press star then one on your telephone keypad. To everyone participating in today's Q&A session, you are limited to one question. If your questions have been answered and we should move yourself from the queue, please press the pound key. Our first question will come from Karl Keirstead with Deutsche Bank. Your line is now open.
Thank you very much. Maybe a question for Keith and Mark. Keith, you did mention you've been in front of a lot of customers of late. I'm just wondering whether the tone of those conversations have changed much in the last few months, just not so much in terms of their Salesforce, projected spend, that sounds like it's very strong, but just their broader view of the economy and the macro. Don't want to force you into being an economic forecaster, but just wondering if the tone has shifted at all. Maybe a follow-up for Mark Hawkins. Mark, given that the performance on operating cash flow through the first nine months, you only need about 5% operating cash flow growth in 4Q to hit your 16% growth target. You obviously much higher than that last fourth quarter.
I know it's hard to predict, it's based on timing of invoice payments, just curious if there's anything you'd flag for us. Thanks so much.
Hi, Karl. It's Keith. I have been on the road quite a bit, actually, in the quarter. I've had the opportunity to spend a lot of time out in the front lines with the troops and our customers. Here's the message I'm hearing. It is all about digital transformation. I am not going to make any comments about the macro environment. From what we see, it's all good. This is a CEO-level agenda. This transformation is important. The sense I get, regardless of any speculation around the economy, is that this has really become a mandate. This wave of innovation, this wave of technology that is sweeping the globe, is an imperative for these CEOs to be those chief transformation officers. That's what's going on in the market, that's why you see the results with us.
Okay.
Let me just add to that, I said this a little bit already at Dreamforce as well, I've said this recently on TV. When I speak to CEOs, that happens probably every single day, especially since these tax cuts that have happened, CEOs have been investing aggressively, the economy has literally been ripping. I think that a lot of the forecasts that I've seen on the 4% level in the U.S., we felt that before that happened, we were talking about the economy was ripping even before those aggressive growth estimates. When we look out for next year, I'm not sure I could see it going faster than it is now, because I'm not sure where we even get all the people to hire that we need to hire. It's amazing what's happening, not just for us, but for everybody.
Maybe there's a modest reduction in growth. If it's 2%-3% next year in the GDP, I wouldn't be hugely surprised. I don't see some huge sea change in the economy. I continue to see strong growth because I've seen so much investment this year that's going to pay out for these companies going forward. I see still several years ahead of good, solid growth for the economy. Where that gets tempered, I think I've mentioned this before, is when I talk to European CEOs, they tend to be more conservative, some of those CEOs, they may be specifically in their region, are not as optimistic potentially as, I would say, American or Asian or CEOs based in Asia.
That's how I still look at it, that we are still in an economy right now, look at these numbers, that are ripping, we still see very much a huge investment focus going on.
Let me just jump on the second part of the question, Karl. Thank you for that. Yes, we're obviously pleased with our operating cash flow performance year-to-date, as you've called out. We're very much tracking the fiscal year number that we have been driving toward ever since we acquired MuleSoft, which as we called out, the $150 million impact that would be negative in the first year of the acquisition, mainly due to debt expense and some lost interest income. The other factor to look at that, besides the fact that we're absolutely tracking our fiscal year, is Q4 is one of the biggest quarters of the year for us, obviously, we'll know more as we get to the end of that.
We feel that this is appropriate to stay with the fiscal number, especially in light of the fact that Q4, there's clearly an FX headwind. If you just look at the FX rates year-over-year, that's another factor to be considered. We're staying on track for the year. We'll know more at the end of the quarter, but given the FX headwind, I think this is totally appropriate.
Thank you. Our next question will come from the line of Philip Winslow with Wells Fargo. Your line is now open.
Hey. Thanks, guys, for taking my question. Congrats on a great quarter. Just really want to focus on just the concept of the front office suite. Obviously, you guys have talked about that for several years now, and we're obviously believers. If you think about this year, we've seen probably north of $15 billion of M&A from some of your competitors trying to build out different pillars of a suite. What are you hearing from your customers in terms of just the competitive landscape, essentially sort of post this M&A, and even beyond the M&A, some of the data sharing initiatives out there between frenemies. What are you hearing from customers? How do you think about how the landscape's changed?
Well, I think that we should ask our President of Products, Bret Taylor, is here to give you his vision of where we're going with our Customer Success Platform.
Yeah, I think our strategy as it relates to competition is really reflected in our Dreamforce announcements, particularly Customer 360. When we talk to our customers, they're not looking to buy a piece of technology, they're looking to transform their business. Our strategic advantage is that we're the number one in sales, the number one in service, the number one in platform, the number one in marketing. If you look at Black Friday, I think you can really see this in the way our customers are using every single one of those technologies to transform their customer experience. You might send out a promotion for your Black Friday sale via text message or via email in our Marketing Cloud. You transact in our Commerce Cloud, you provide service via our Service Cloud.
We are the only company that can provide all of the solutions in an integrated way. Now with Customer 360, you have a single view of your customer through all of those touch points. Our strategic advantage relative to competitors who are trying to catch up by acquiring the second-place product in each of these spaces, is that we are an integrated solution. Keith and I have talked a lot about this. Our customers are looking for an integrated solution to their business problems, not just pieces of technology. That's our strategic advantage in our product portfolio.
Bret, you've done a great job. When we look at that product portfolio, and we look at what you've built out with the Customer Success Platform, you've got, of course, Sales, you've got Service and Field Service, you've got Marketing, you've got B2C and B2B Commerce, you've got engagement with Heroku, which still remains on a tear. You've got Platform and this incredible ecosystem. You've got integration, not just with Customer 360, but obviously this work with MuleSoft. You've got advanced analytics. The work with industries. You saw how well Financial Services Cloud did this quarter. You got partners and communities, enablement, collaboration, and on top of all of that, you have that whole Trailblazer community. I don't think there's any company that has built out a comprehensive Customer Success Platform like that.
When you got to Dreamforce and saw it all tied together with Customer 360, what was your biggest surprise?
My biggest takeaway was the importance of Trailhead and that Trailblazer community. It's interesting, when one of our customers decides to deploy our technology, we're not the only person there helping them. Our partner ecosystem is there with them. That partner ecosystem is fueled by Trailhead. One of the things that you mentioned, Marc, in your opening, I think is really powerful. There's over 1 million people learning for free on Trailhead, and one in four have gotten a new job on the other side of that because they're developing new skills. When we used to think about it from our customers' perspective, and the thing that you see in spades at Dreamforce is when someone decides to deploy Salesforce, they have the best ecosystem of support and the best partner community around them.
That's really what's driving the success of our customers with our technology, which is the thing that we are exclusively focused on.
Thank you. Our next question will come from Derrick Wood with Cowen and Company. Your line is now open.
Great, thanks. Keith, one of the things that we commonly heard at Dreamforce is that partners are finding it harder to hire and build up Salesforce certified resources to meet the demand, which is, I guess, essentially saying that demand is outstripping supply from a consulting and implementation standpoint. Do you hear this as a trend in the field from your partners? Do you ever see it weighing on pipeline conversion cycles? You were just talking about Trailhead, but I know it's been on the market for a little bit. How effective do you view Trailhead in helping to virally cultivate resources, and can it help maybe populate talent in a quicker fashion than you've historically seen?
Yeah. Thanks for the question. As you know, the relationship that we have with our partners is very strategic to our business. You heard me talk about in the call that they're involved in about 64% of our go-to-market efforts. The certifications, 19 consecutive quarters of double-digit certification growth. You go talk to any of these firms, whether it's PwC or Deloitte or Accenture or IBM, and ask them what their fastest-growing practice is in scale, it's Salesforce. This is great news for our customers because we wake up every day, as you know, as a company, and we think about what's important for our customers. The partner ecosystem is certainly a big part of that. We are very focused on our partners. We have plans with them to not only increase their capacity, but also to enhance their capability.
The centerpiece for that is Trailhead. Offering and extending Trailhead for them to make sure that they get the right skills at the right time, so that they can convert and cannibalize their practices from their legacy providers. That's been a part of their strategy. We also encourage the growth of boutiques because it's not just in the enterprise-based business, it's also in the mid-market and the SMB. We invest, as part of our funds, with Salesforce Ventures to provide startups the opportunity to build and cultivate these boutique practices to help with the SMBs. We've got a pretty comprehensive strategy to build out these SMBs, SMB boutique consulting firms, these Accentures of the world, et cetera. In my entire career, I've never seen a closer relationship with the SI ecosystem like the one that we have at Salesforce.
We do a lot of joint planning. There's a lot of collaboration. They're very integrated in everything that we do inside this company. Again, they're a big part of our future. We're very optimistic that they will continue to expand and convert the resources they need to drive success for our customers.
Keith, let me ask you a question. Let's say there's an entrepreneur who's listening on the call today, and they're hearing what you're saying. Are you saying that?
If I'm an entrepreneur and I want to start a new company, starting a company providing these kind of boutique services in the Salesforce ecosystem, that's a good business opportunity? Is Salesforce investing in those companies? Are you going to invest?
That is a fantastic business opportunity, that's one of the reasons why we've got the consulting funds that have been set up with Salesforce Ventures around the world.
We've seen so many of those boutiques get acquired by the mainstream SIs and motivate and grow their practices aggressively.
Absolutely. The important thing for us to continue to do is to keep cultivating and growing those practices at the mid-market space.
You look at some of these companies that were strong independent companies, like Bluewolf was a great example.
Acquired by Adobe
Some of the other.
Yep.
They've been acquired now by the very largest and most important systems integrator.
Yep.
This remains a great opportunity for everybody.
Absolutely.
Terrific. Thank you.
Thank you. Our next question will come from Kash Rangan with Bank of America Merrill Lynch. Your line is now open.
Hey, congratulations, Salesforce team. I have a bit of a philosophical question. You're sitting on some big markets, massive TAM, $145 billion. Only one of your clouds is really dominant in terms of market share in its industry, which is Sales Cloud. I'm curious at what point, like some of the commanding technology companies in the yesteryears, whether it's Oracle in the database market or Microsoft in the operating system market, where they defined the market. At what point are we, or how close are we to a tipping point where Service, Marketing, Commerce, Platform, all these markets really start to tip in your way?
That it's not really so much of outbound. Of course, there's always going to be outbound selling motion, but the market really starts to come to you start to get these dominant shares in the other markets, so you can start to realize your TAM, $145 billion TAM, in a more significant way. That's it for me. Thank you, and happy holidays in advance.
Well, Kash, I think you can really see this in the growth rate that we're reporting on all the clouds. This is not anything that we're trying to keep from you. You can see it in the numbers that it's an abundance of riches at Salesforce. Yes, we have a great product with Sales Cloud that's doing just fine, but we also have a phenomenal service business, and field service business, and service add-on business that's also growing extremely well. We also have an amazing Marketing Cloud business that's growing extremely well, and Commerce Cloud, and I mentioned Heroku, and it doesn't get reported, but it's part of our Platform, obviously, a very important part of our Platform, integrated, which is also a great business. Now we have an integration business, which is also an unbelievable business. We have an Analytics Cloud that's an unbelievable business.
We have industries that Keith has cooked up with financial services and Health Cloud, which is also an unbelievable business. By the way, we acquired Bret Taylor's company, Quip, which is an unbelievable business, and just did a huge deal with Citibank for the quarter. That was awesome to see what Citi did with Quip, enabling all of their employees around the world. Congratulations to Bret and Kevin, helping Citi work together faster in this incredible productivity environment. It's a product I use every day. If you haven't downloaded, it's what Amazon uses, it's what Apple uses, it's what Citibank uses to manage their productivity. You saw it at Dreamforce. We now have Quip Slides, which is incredible. It's an abundance of riches, and the key organizing principle, though, for us is the customer.
Yes, we're in all these areas, there's other companies in service, there's other companies in marketing, there's other companies in a lot of these areas. Our organizing principle is that we're here to tie it all together to give you a 360-degree view of your customer, and that's what's unique for Salesforce. Every company has its own organizing principle, as you know, because you cover all these companies. You know what ours is, and you know what our answer's going to be, that everything begins and ends with the customer. Bret, do you want to add to that?
Yeah, I think Mark put it exactly right, the backdrop that I'm really excited about, the reason why I think you see such amazing growth in Service Cloud, Platform, Marketing Cloud, and continued growth in our Sales Cloud, is these product areas aren't staying still. The fourth industrial revolution is transforming each of these markets. Take Service Cloud, which is just an amazing product with an amazing growth rate. Right now, artificial intelligence is completely transforming that industry, and it's driving every CEO to Salesforce to say, "Hey, how can you help me transform my customer service experience?" Which is really the tip of the spear as it relates to customer experience, and that's why our Service Cloud is growing 24% year-over-year, one of our largest and fastest growing businesses. You're seeing this in every single cloud.
As the technologist here, what's exciting for me is not just really TAM, but also just seeing the motion of change in each of these businesses, and how we can help our customers navigate these technology changes happening around them.
Thank you. Our next question will come from the line of Patrick Walravens with JMP Securities. Your line is now open.
Great. Thank you. Let me add my congratulations. MuleSoft is clearly proving to have been a great decision for you. What sorts of things might make sense for Salesforce to buy next? Mark, I'd love to hear your thoughts, if it fits in there, on SAP's acquisition of Qualtrics.
Well, I can just tell you that there's a lot of things that Salesforce can do because this customer opportunity is much bigger and more exciting, I think, than anybody really ever realized. But for MuleSoft, this is a company that I've loved for years. This is a company that I helped lead, our early investing in, and then we helped them go public and so forth. I wanted to buy them for years. Fortunately, I have a very strong and stubborn management team that's sitting around the table, and they're not that easy to deal with, and they make it hard for me to do what I want to do, but I did get that one over the line. Thank God for that.
There's a lot of others that I would love to see, that I think that our customers would love to have, more tightly integrated, more part of our product. It's really important. Look, other companies, I don't know if you've seen the front of The Wall Street Journal lately, but we put a market share graph on CRM on the cover of The Wall Street Journal. Have you seen it? I don't know if we also put it in our slide deck here for you. Hopefully, we did, because it's our number one marketing graphic. Not everyone is doing as well as we are in CRM. Not everyone is doing as well as we are in cloud, and you know that.
Every year, they've got some new thing, whatever, I can't follow them all because they're all so difficult, they buy companies I've never heard of, so I can't really comment on them. God bless them, I hope that they're successful in CRM because it's been good for us.
Thank you. Our next question will come from Alex Zukin with Piper Jaffray. Your line is now open.
Hey, guys. Let me add my congratulations to the quarter. I want to ask a question about verticals, maybe for Keith. You talked about some amazing success in financial services, the big deal with the financial institution, with the success being driven by Financial Services Cloud, which we also picked up in our fieldwork. I guess, I wanted to understand, could you talk about what is the incremental value prop and features that are available to customers that go from generic Service Cloud to Financial Services Cloud, and any commentary on the financial uplift that Salesforce sees through those migrations would be appreciated.
Hi, Alex. Listen, I'm happy to get into a feature function conversation with you if you'd like. Here's the way I would think about Financial Services Cloud. First, in the beginning of time, there was the Service Cloud, right? Then, on the seventh day, God created something else, and said it was Financial Services Cloud. Then Financial Services Cloud started out in wealth management, then it went from wealth management to retail banking, then it went to consumer banking, then it went to commercial banking, and the list will go on and on. Oh by the way, Financial Services Cloud has made great integration points with partners like Guidewire and Velocify as well. Those are compelling solutions for our customers. At the end of the day, this is a capability that customers want to buy off-the-shelf software.
They don't want to be customizing and building their own capabilities, because in a sense, that's just re-paving the cow path . You're just doing a tech refresh, but really, you're not retiring your legacy debt. That's why customers want these capabilities embedded in our technology. That's exactly what we're doing. We're responding to our customers in these industries by providing very rich functionality that is specific to what those customers are looking for. That's been the strategy. We can do that two ways. One is that we can enhance our product so that these customers get the commercially available off-the-shelf software, or we can go partner with an ISV, like an nCino or a Velocify or the others that I mentioned. That has been our strategy. You can see the results.
If you think about the pace of Financial Services Cloud, arguably it's the most successful cloud that we've ever launched, and has established very deep and meaningful relationships with our customers. The roster of financial services companies that we're doing business with now, they all want Financial Services Cloud, and we just continue to win and win and win in that space. It's very, very exciting for us.
For the previous question, where there was a question about how we're doing with our competitors, I put on my Twitter feed for you the market share information so you could get that directly.
I do want to make a comment about the competitors, because I've been listening to Mark and Bret talk about this. A lot of these companies have been in the business a very, very long time. They've been in the legacy business. They have not been in the cloud business. They claim that they could be cloud companies because maybe they have an architecture that suggests they're part of the cloud. It's not just about the architecture, it's also about the business model, but most importantly, it's about the culture of the company and the focus on the customer. Since the day this company was started, everything that we do is focused on the customer.
If you go look at some of these legacy companies that are trying to get in the game of the front office and say that they're now CRM companies, it's not in their DNA. As Mark said, we wish them luck, and we'll see you in the marketplace, but please don't underestimate the importance of having the customer as part of your culture.
I really have to start to curtail my comments. As I'd love to talk about specific companies and other CEOs, every time I do, I get a phone call. They're very sensitive, and I don't want to hurt anybody's feelings during the holidays. I'm really holding back on this call. I'm just going to do that one tweet.
Thank you. Our next question is coming from the line of Thomas Roderick with Stifel. Your line is now open.
Hi, gentlemen. Thank you for taking my question. Question for Marc Benioff. Marc, you're constantly in touch with global tech leaders, partners, and going back to Dreamforce, you certainly had some nice updates relative to Google as a partner, some of the things you're working on there. They, of course, have had some changes at the leadership at the top. I'd love to hear a little bit more, if you could talk about how that partnership has progressed. Now that they are sort of going through some new leadership changes at the top, what sort of opportunities exist to further extend that partnership? AWS has been fantastic. This one has a nice sort of start off the ground with the analytics side. Where can you take it from here?
Well, you just mentioned two great companies, Amazon and Google, who both have both phenomenal cloud offerings. They both have very strong CEOs. Andy Jassy is amazing, and also Sundar is amazing. They're both doing extremely well in our customer base. We see lots of action with both of those customers and partners. Specific to Google, Bret obviously is the creator of Google Maps and worked at Google for a while, so I don't know if you want to touch on how you have a unique perspective in all of this.
Yeah. I just know it's such a great privilege to have such amazing partners, and we really work backwards from customer success and what our customers need to be successful. When I look at Amazon Web Services, Apple, Google, we're really saying, who are the companies that our customers want to partner with, and who do they want us to partner with to drive success? When I look at Google, every single one of our Marketing Cloud customers, Commerce Cloud customers, has a deep relationship with Google because of the prominence of Google Search, their ad network, marketing, analytics. I really view it as an amazing opportunity to bring the best of both companies to bear when we're trying to provide these solutions to our customers. Our customer response has just been fantastic.
I hope to deepen that relationship in the future, just make sure that when we provide these solutions to our customers, the products work together, our companies work together, our customers have an amazing experience.
Thank you. Our next question will come from the line of Jennifer Lowe with UBS. Your line is now open.
Great. Thank you. As you start to talk with CEOs and senior decision-makers about these big strategic digital transformation projects, you mentioned many of them are multi-year in scope, it strikes me that these touch a lot of systems, a lot of processes, and it's a challenge to sort of figure out what comes first. As you sort of start through that prioritization process, how often are you going in and creating a new application that didn't exist before versus replacing legacy off-the-shelf software versus custom app development or replacing legacy custom applications? How has that evolved as you increase your strategic value to those customers?
Yeah. Hi, this is Keith. That's a great question. The way I would think about this is that the whole environment is just ripe for innovation, okay? The innovation could be something that's custom-developed with our technology, or it could be something that's just using our standard products. Obviously, customers like to take advantage of the flexibility that our products provide, they want to model their processes aligned to our technology rather than building custom apps themselves, comma. The power of the technology is such nowadays that you can do amazing things that you couldn't have done before. It's kind of hard to give you an apples-to-apples comparison. It's really an interesting phenomenon because the wave of innovation is just so impressive in what we're seeing in the marketplace, that innovation is supported by our Platform.
It's supported by our Service Cloud, our whole Customer Success Platform. It's hard to give you an exact number, it's all about innovation and creating the art of possible.
All right. Well, as we bring our call to a close, I want to thank everybody for participating on today's call. As I opened the call, I also mentioned our hearts remain with everyone who suffered during the horrible fires. I'd like to bring your attention to our local organization who is doing so much and has done so much support already, which is our North Valley Community Foundation, which is providing tremendous support for the Camp Fire relief. If you could support them, we would appreciate it. It's nvcf.org, as in Nancy, Victor, Charlie, Frank dot org, North Valley Community Foundation, and our hearts are with the entire community of Paradise and the surrounding areas affected by the Camp Fire.
We would love for you to please consider a tax-deductible donation to the Camp Fire Relief Fund and to assist in the many community organizations who are serving evacuees, and especially our tremendous first responders. Thank you, everybody, and we'll look forward to talking to you again next quarter.
Ladies and gentlemen, thank you for your participation on today's conference. This will conclude our program, and we may all disconnect. Everybody, have a wonderful day.