John Cummings – Director of Investor Relations Marc Benioff – Chairman and Chief Executive Officer Graham Smith – Executive Vice President and Chief Financial Officer

Brent Thill – UBS Heather Bellini – Goldman Sachs Mark Murphy – Piper Jaffray Brendan Barnicle – Pacific Crest Securities Nandan Amladi – Deutsche Bank Keith Weiss – Morgan Stanley Samad Samana – FBR Phil Winslow – Credit Suisse Jason Maynard – Wells Fargo Walter Pritchard – Citi Raimo Lenschow – Barclays Capital

Good afternoon. My name is Shinal, and I will be your conference operator today. At this time, I would like to welcome everyone to the Salesforce.com’s Fiscal First Quarter Results 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. (Operator Instructions) I will now turn the call over to John Cummings, Director of Investor Relations.

Thank you, Shinal, and good afternoon everyone and thank you for joining us today to discuss our fiscal first quarter 2014 results. Access to the first quarter results press release, our SEC filings and a webcast replay of today’s call can be found on our Investor Relations website at www.salesforce.com/investor. And as a reminder, we’ll also be posting the highlights of our call on Twitter at the handle @Salesforce_IR. With me today to discuss our Q1 results are Marc Benioff, Chief Executive Officer; and Graham Smith, Chief Financial Officer. Marc and Graham will open with a few prepared remarks and then we’ll turn the call to over to answer questions. Please note that our commentary today will be primarily in non-GAAP terms. Reconciliations between GAAP and non-GAAP metrics for both reported results and our forward guidance can be found in our earnings press release issued an hour ago. In addition, we may offer incremental metrics to provide greater insight into our business or our quarterly results. Please be advised that the additional detail may be one-time in nature and may or may not be provided in the future. It’s also possible we may reference certain unreleased services or features not yet available, because we cannot guarantee the future timing or availability of these services or features. We recommend customers listening today make their purchase decisions based on services and features that are currently available. The primary purpose of today’s call is to provide you with information regarding our fiscal first quarter 2014 performance. Some of our discussion and responses to your questions 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. All these risks, uncertainties, and assumptions, as well as other information on potential risk factors that could affect our financial results are included in our forms filed with the SEC, including our most recent report on Form 10-K, particularly under the heading, ‘Risk Factors.’ So with that, let me turn the call over to Marc.

Thanks, John. And I’m thrilled to kick-off our fiscal 2014 to be another great quarter at Salesforce.com. Revenue for the first quarter rose 28% from year ago to more than $890 million. At constant currency, revenue grew faster at 30%. Operating cash flow exceeded $280 million for the quarter also an increase of more than 30% year-over-year and deferred revenue grew to more than $1.7 billion also up 30%. Based on these great results, we’re raising our full fiscal 2014 revenue guidance which we project at $3.835 billion to $3.875 billion and will roll on our way to first $1 billion quarter. In addition, I’m thrilled that after a decade of growth and market share gains, Gartner announced this quarter that Salesforce is now the largest CRM platform in the world. We’ve displaced SAP to become the number one CRM market share leader regardless of On Premise or Cloud, Salesforce is number one. I’d like to congratulate all of our employees, our customers; our shareholders on this important achievement of become the number one CRM company. Salesforce has always been a catalyst and evangelist for innovation and enterprise software. We pioneered the shift to cloud, to social, to mobile and today with this next generation of technology, our customers are connecting with their customers in entirely new ways. They are becoming customer companies and they’re transforming for managing systems record to systems of engagement and we’re leading the way. With our full product lines, the Sales Cloud, the Service Cloud, the Marketing Cloud and the Salesforce Platform, customers have the tools to become customer companies and unlock greater levels of growth, innovation and success. That’s why our customers have made us the clear leader in each of our four core markets. First, our flagship Sales Cloud is the number one app for sales teams helping customers to drive phenomenal sales productivity and top line growth. It’s the only sales platform with built-in tools motivating line teams through Work.com and continuously refresh company and contact information through Data.com and with the latest release of Salesforce Chatter customers can access sales clouds records and files right from their mobile devices. The new Chatter mobile app is available now from the Apple app store and from Google Play and I recommend that you download and see this incredible new vision of how CRM works in the mobile environment. The Service Cloud is the world’s number one app for customer service and support and it’s the only service platform that ties customer service with sales and social. In the quarter, we announced our latest Service Cloud mobile innovations including mobile co-browsing, mobile communities, mobile chat and a touch based agent interface and are divided down to just last week. Gartner named Salesforce the clear leader in both vision and execution in the most recent Magic Quadrant for Customer Service. And if you didn’t already know SAP continue to fall behind in the challenge of Quadrant which is why more SAP customers move to Salesforce in the quarter than ever before. The Marketing Cloud is the world’s number one app for sales, social marketing and the only marketing platform that seamlessly connects with sales and service. Marketers want a unified platform to listen, to publish, to engage, to advertise and giving them the power to target individuals of scale, that’s why we want social.com the quarter, the filtered only advertising app that ties ad campaigns on Facebook and Twitter with real time customer and social listening data. Social.com is already managing 500,000 social ad campaigns for customers and is Facebook’s largest advertising partner today. The Salesforce Platform is the world’s number one enterprise cloud platform and it’s the only platform with social and mobile built right into the core. Customers while having a fast and easy development platform to go next generation apps that instantly work on any mobile device and with the launch of new mobile services in the quarter including developer mobile packs and Salesforce Mobile SDK, Salesforce then accelerate mobile app for all of our customers. In addition, we’re filled with attraction of our ISI ecosystem and we’ve doubled the number of ISVs in the app exchange since the first quarter of last year. The combination of our customer company vision and our clear leadership within each of these core markets is what’s driving our success with customers today. That’s why we continue to close some of the most exciting and strategic transactions in the industry. I am thrilled to announce that we closed on our key transactions a quarter, which have been small and medium enterprise agency, a government agency that serves more than 3 million companies nationwide. We have new partnership with Japan’s government, Salesforce platform and Chatter will touch nearly aspect of the agencies engagement with millions of SMEs. Companies are going to tap in the online marketplaces with service professionals, like attorneys and tax advisors and by connecting Japan to SMEs to each other and information real-time, Salesforce is helping us critical Japanese agency, bolster competition, innovation, and growth in this phenomenal time into the Japanese economy. This continues our commitment to partner with the Japanese government as our most important and largest customer. And on May 28 at our customer company tour in Tokyo next week, you’ll be hearing more from me about how this agency plans to create millions of SMEs together so onto the Japanese governments first, social business collaboration network. We are thrilled to have you join me in Tokyo. Also on May 28, I’ve been selected to deliver a key note to government leaders at the U.S., Japan, counsel symposium along with U.S. ambassador, John Roos and I hope I look forward to see you there. We continue to deliver tremendous success with companies like General Electric where we had great momentum with major divisions including GE Capital, GE Oil & Gas, GE Energy, GE Power and Water, GE Transportation, GE Aviation and now GE Healthcare joining the Salesforce family. GE Healthcare is the world’s biggest maker of medical imaging equipment. They are standardizing on Salesforce as their global CRM platform and by connecting their entire front office team directly to the millions of physicians and hospitals they serve. GE will be fueling an order level of customer intimacy. Another great win in the quarter is Toms Shoes. In the quarter Tom selected Service Cloud, Marketing Cloud and Chatter to build the central hub for his entire team of service agents and listen, engage and service customers wherever they are. While they are great for large companies, we are great for small and medium companies too. And by linking of SAP and Oracle back office systems with Salesforce, Toms would be able to arm agents with a full view of the world that is around each and every customer. In everyone of these examples, companies are transforming their business of Salesforce’s next generation technologies. Our ability to deeply integrate our cellphone and mobile front office solutions with legacy back office systems like Microsoft, SAP and Oracle is helping many of our customers transform into customer companies. Our other new or add-on transactions in the first quarter included Belkin and Bristol-Myers, Cree, Metso, New York Life, Novartis, Panasonic, and (inaudible) and we continue to crush the competition in the quarter against Microsoft and own significant new or add-on business in companies like Jonathan Press, KDDI, LodgeNet, McGraw, Old Mutual, Regence, and TalkTalk. Against Oracle we won at Baxter, VP, DirectTV at ING at National Australia Bank at NTT, at Virgin and against SAP at Deloitte, Fujitsu, at Juniper, and Lenovo and Millipore, Nokia, Sony, Toms Shoes, (inaudible) HANA, Home Depot and the list goes on. The pace at which these are companies are embracing our social and mobile cloud technologies is phenomenon. During this last quarter, we passed our first 1 billion transactions day, and already in this quarter we’ve delivered an average of 1.2 billion customer transaction each and every business day, that speaks more to the value of Salesforce. Then the actual usage of our products with the speed, reliability interest that we’ve become known for. In closing I’d like to invite all of you to join me at one of our customer company tour events to see our new products, to hear our new message, to visit with the customers and prospects we’re making these decisions, I’m transforming our industry into the cloud and seeing why Salesforce has become the number one CRM provider in the world. You could join me in Tokyo or Sydney, Australia on May 28 and São Paulo Brazil on June 11, and New York City on June 14 and Rotterdam on June 18, and Toronto on June 19 and at Munich, Germany on July 2. More than 15,000 customers across 11 cities have already tendered or sold out customer company tour events. And we hope to see you at one of them soon, so you can feel the energy, the excitement, the momentum and the growth and what’s driving Salesforce into this incredible new position as the world’s largest customer company. I’m also thrilled to announce that registration for Dreamforce 2013, the world’s largest technology vendor conference has opened today. We expect more than 120,000 registered attendees to join us in San Francisco from November 18 till 21 and I look forward to seeing you there. With that, let me hand it over to our Chief Financial Officer, Graham Smith.

Thank you, Marc. We delivered another solid quarter in Q1 with strong year-over-year revenue, deferred revenue and operating cash flow growth. Our success during the quarter was driven by continued demand across all of our cloud solutions supported by further declines in attrition. Let me take you through these another highlights from our first quarter results, starting with the income statement. Q1 revenue was $893 million, that’s up 28% over last year, excluding an approximately $10 million FX headwind, first quarter revenue was up 30% year-over-year. Looking at year-over-year growth on a regional basis, revenue in the Americas grew 30% to $631 million. revenue in Europe grew 38% in dollars, and in constant currency to $163 million and revenue in Asia increased 7% in dollars and 17% in constant currency to $99 million. As I mentioned previously, our dollar attrition continued its steady decline in the first quarter and is now in the low double-digit percentage range. Our first quarter non-GAAP gross margin was 80.2%, that’s about a 160 basis points lower than Q1 last year. Our first quarter non-GAAP operating margin was 10.5% or about 100 basis points lower than last year, leading to the first quarter non-GAAP operating income of $94 million, that’s up 18% over the last year. Our results in Q1 included an approximately $8 million charge for an IP licensing agreement, which was recorded in costs per revenue. This represented about 90 basis points of margin dilution in the quarter. We added more than 480 new employees in Q1, bringing our total head count to 10,300, that’s up 23% over Q1 last year. Turning to EPS, non-GAAP EPS was $0.10 for the first quarter. the licensing agreement charge that I just mentioned represented approximately $0.01 of GAAP and non-GAAP EPS. Turning to cash flow, first quarter operating cash flow was a record $283 million, up 33% over the first quarter of last year. We continue to expect full-year growth in the low 20ish percent range. CapEx in the first quarter was $54 million, up 20% over Q1 last year. CapEx continues to be primarily driven by new office buildouts related to our growing employee base and remain flat year-over-year to approximately 6% of revenue. Free cash flow which we defined as operating cash flow less CapEx was $229 million in the first quarter, that’s up 36% over Q1 last year. Turning to the balance sheet, we ended the quarter with approximately $3.1 billion in cash and marketable securities, up from approximately $1.7 billion last year. As you’ll recall in the first quarter, we successfully closed a $1.15 billion convertible senior note. Accounts receivable was up 35% over the last year to $503 million. Deferred revenue ended the first quarter approximately $1.7 billion, that’s up 30% over Q1 last year. Excluding a year-over-year FX headwind of approximately $18 million, deferred revenue increased 31%. On a sequential quarter basis, deferred revenue was reduced by an FX headwind of approximately $16 million. In addition, please recall that in our most recent fourth quarter we build and collected an approximately $30 million invoice, that was initially build as new business early in the first quarter of fiscal 2013. This also created a sequential headwind to deferred revenue in the first quarter. Deferred revenue continue to benefit from the shift toward annual billing were just under 70% of all invoices in Q1 issued with annual terms, this was about five percentage points higher than Q1 last year. The dollar benefit to deferred revenue from the shift to annual invoicing together with multiyear invoicing was approximately $100 million, that’s down from $145 million at the end of Q1 last year. Unbilled deferred revenue or revenue that is contracted, but not yet invoiced and is off the balance sheet was approximately $3.6 billion in Q1. That’s an increase of 33% over Q1 last year. Before I turn to our guidance for the second quarter and full-year, I want to highlight the impact of foreign exchange particularly the Yen is having on our financial results. We’ve had great success in Japan and today our Japan subsidiary represents approximately 6% of total corporate revenue. When we updated our fiscal 2014 guidance in February, the Yen was around 92 to a U.S. dollar. This week, the Yen dollar rate has been in the 101 to 103 range, devaluation of about 10%. In fact, the Yen has been the fastest [growing] major currency in the world this year. This and other currency fluctuations have reduced our full-year revenue outlook by approximately $35 million, including the $10 million in Q1 that I mentioned earlier. As a reminder, FX rates impact not just revenue, but also operating margins, deferred revenue, and cash flow. So with that context, we are pleased to be raising our full-year revenue outlook to $3.835 billion to $3.875 billion for growth of 26% and 27%. Taking into account a difficult FX environment and the IP licensing agreement charge, we are also pleased to maintain our full-year non-GAAP EPS guidance in the range of $0.47 to $0.49. This range assumes a full-year effective non-GAAP tax rate of approximately 35% and no mean for contribution from below the line interest or other income and expense. For Q2, we anticipate revenue in the range of $931 million to $936 million for growth of 27% to 28%, and we expect non-GAAP EPS in the range of $0.11 to $0.12. We expect second quarter year-over-year operating cash flow in the mid to high teens percentage range, and then in addition we expect Q2 CapEx as a percentage of revenue to be approximately 11%, that’s a little high than normal, it’s due to the phasing of new office build outs, increased data center investments, and the capitalized portion of the previously mentioned IP licensing agreement. For the full year, we expect CapEx as a percent of revenue to be about 7%, which is in line with previous year. We anticipate reported year-over-year deferred revenue growth in the mid to high 20% range. As Marc mentioned earlier, Three Force is being held in the fiscal fourth quarter. For modeling purposes, this will affect EPS, linearity for the year as we expect Three Force to reduce non-GAAP EPS by approximately $0.02 to $0.03 in the fourth quarter. As a reminder, Three Force was in our fiscal third quarter last year. All of the underlying assumptions through our GAAP and non-GAAP guidance, a complete GAAP to non-GAAP reconciliation to be found in our earnings press release issued today. So to conclude we kicks off fiscal 2014 with a solid first quarter delivering strong revenue, deferred revenue, and operating cash flow growth, our dollar attrition continues to decline is now the lowest level since we began measuring it more than three years ago. We continue to see strong demand across all of our cloud solutions and are well positioned to deliver another great year of growth. So with that, we’ll open the call out for questions. Operator?

: Brent Thill – UBS: Hi, great. Marc I was curious if you could just give us your view on the next steps for the Marketing Cloud and if you could also address with Social.com as you mentioned, your pricing is now based on the percent of the ad spend a little different than your past pricing model. Can you talk about – should we expect more changes going forward in some of the pricing methodologies that you’re unveiling some of the new products going forward? Thank you.

Well, thanks very much for that question. An area where I spent a lot of my time, initially say how I look at this, strategically. number one, Salesforce is now the number one CRM Company in the world. I mentioned that in the script, and that’s an incredible accomplishment for the company. And for us to continue to be number one in CRM world, it means that we have to be number one in three main areas. One, we have to be number one in sales, which we are, and if you can see the new Gartner Magic Quadrant in sales it’s clear as they were number one. And it’s not any clear, and then if you get the new Magic Quadrant for our customer service and then support and customer engagement that just came out about a week or two ago now. It’s credible market in customer support. we’re number one in service. And that has been an incredible journey, it’s been a fight, it’s been tremendous accomplishment, and especially gratifying when we saw SAP got pushed into the challenge of Quadrant, as we assume this strong position in the Leader Quadrant. And that’s very important to us. so, number one in sales, number one in service. And that’s true in revenue, that’s true in market share, and that’s true in feature functionality. Now, marketing is an area that we’ve recently entered into, as you know. and it’s not really an area that we’ve gone through into organically or grow our own development, but we’ve acquired our way into marketing, first by purchasing Radian6 and then by buying Buddy Media. Buddy Media had purchased just before, we bought them Brighter Option, which we then have rebuilt and now relaunched as Social.com. And by no means, are we number one in revenue, in marketing. This is the year-over-year marketing revenue well enter its nine digits for the first time and but it’s not a $1 billion cloud yet. It’s a $100 million plus cloud and our goal is to be number one in marketing, but we realize that to be number one in marketing, we’re going to have to achieve more than $1 billion in revenue in that cloud and these not just number one in listening, not just number one in publishing, not just number one in social advertising but in a number of other key areas as well, I’m strategically, I believe that this is very important to the company and so, I’ve been spending a lot of my time, looking at this and we, you’re going to see us experiment and try things and innovate in as you saw in acquisition which you’ve seen us doing last two years, in pricing like you’re seeing with Social.com, in features and functionality, in position and messaging like we’ve seen us evolved into the customer company messaging. And what that has meant to our customers is they’re looking to us more and more and I advised you to the customer company tour, presentations, you can meet these customers and validate this but they look to us to help them understand how to connect with their customers in this kind of incredible new way. And our goal is to be the trusted advisor and to do that, it means that we’re going to have to deliver world-class market functionality, we’re focused on that, we’re excited about that, not just in B2B, but in B2C as well and what you’re seeing in those changes or in those pricing that you’re asking about Brent is our innovative and ideas and experiments as we move from $100 million business in marketing, $1 billion plus business.

Your next question is from Heather Bellini with Goldman Sachs. Please go ahead with your question. Heather Bellini – Goldman Sachs: Hi, great. Good afternoon gentlemen. I was just wondering Marc, we have a good number of private companies telling us they’re starting to write ease some very big checks for Force.com. I was wondering if you could talk about, what we should be expecting in that business, what type of milestone should be we looking for, I know you mentioned what you did in Japan this past quarter, but is there anything else you could share with us on kind of things we should use to benchmark the business?

Yes. There are – the way to look at this business, which we call the Salesforce platform, is the following way. First of all, where our customers were buying our sales or service or marketing products they’re extending those products with applications that are customer centric and they are customizing, they are enhancing, they’re configuring using the Salesforce platform, which includes Force.com, which includes our APIs, which includes Heroku, which includes Site.com, our website capability, which includes our app exchange where we have approximately 2,000 applications in there. And that stuff, they are extending and complementing the work they have done with sales, service and marketing. Step two is, a lot of those companies are building their unique custom applications. And those applications are the applications that they need, the apps that they need to run their business. Used to be back in the day, the big companies by Sequel Server, Visual Basic Powerbuilder, sequel forms whatever it was to basically do structured and unstructured data management, and have rapid application development capability. We see those customers turning to our platform to get that same kind of capability rapidly. And we’re very excited about the growth of that brings us, the stickiness that brings us with the customer by starting to manage their metadata, not just the data and delivering those next-generation apps. And three, the AppExchange, you’ve seen a number of really great ISV’s converge on our AppExchange, many of them who are building natively on our platform. And these app, application companies, I mean just great, great, great companies some that are even going public now, I’m sure you know, with native apps. And we could be more excited for them. And we’re continuing to grow and also partner from a revenue and go-to-market perspective with a lot of those companies. And we have a whole Salesforce dedicated to selling to ISV’s, to help them unify with our platform and to go-to-market to our customers. And as these three things together that are working really well with the platform. The extending and complementing the CRM capabilities, building entirely new apps and a traditional app dev space, route space. And three, a platform for independent software to the vendors to build their own applications to target our customers or their own customers or to the big industries. And if these three things have their together then you hear, for some of these what might look like very small companies riding us extraordinary checks as you said, but it’s really because we become partners with them, much in a way that we are partners by the way was our key software vendors. Of course, companies provide us core technology that we write very large text to like Dell, or like Cisco, or like EMC, or especially Oracle, where it’s very important for us to have a strategic relationship with them. They were writing significant checks to them for their licensing, and then it’s a very important part of our business. You’ve seen that now 14 years of business we wouldn’t be in business without those relationships with those vendors providing us our technology and in the same way that they fuel us and we write them the checks. Those ISVs then write big checks back to us. So, it’s very much a symbiotic relationship between us and those customers or between us and our core vendors. And our job is that rising feel will raise all boats and that’s the economy that you’re getting feedback on today.

Your next question is from Mark Murphy with Piper Jaffray. Please go ahead with your question. Mark Murphy – Piper Jaffray: Yes, thank you very much. Marc, how do you think about the scale of the opportunity in the long-term for becoming the customer company and offering the Force.com platform? And specifically, if you compare the size of that opportunity or that market to other markets such as human resources or financials, what do you think has a more profound impact on an organization between modernizing the front office or automating the back office and therefore what do you think is a bigger opportunity?

Well, I’ve got two words for you which is transaction volumes. And I think that you see that with Salesforce, we make public, as you know. In nauseam, we’ve talked about this. I don’t got a revelation anybody on this call or in this room that we publish our transaction rates every single day. But the reason that you don’t see other vendors provide their transaction numbers is because they’re actually quite low. Now, when we publish a transaction number, that’s a complex transaction; it’s a complex transaction that we deliver. You saw that in the first quarter, we delivered 78.7 billion transactions in the quarter. And if you think about other cloud providers, who else is telling you how many complex transactions. Now, when I talk about a transaction, what I mean is as defined by the late Jim Gray who basically define in transaction as a complete unit of work in the computing model and the ability to not only to commit that transaction, which is a technical term, but also to be able to roll back that transaction into unit work. And we’re reporting that transaction number and we’ve done that for quite a few years. I think that you can determine the value that a company is placing on its customers by the amount of data that it holds the amount of metadata that it holds and that is reflected most accurately in the number of transactions. The transaction number is really the sum of all capabilities of the system and saying we’ve delivered when we are on our way to delivering more than a 100 billion transactions in the quarter. Okay, what’s another one that we follow closely tweets the way that really judge the success of Twitter is, of course, when they had a great quarter, I think it was almost $300 million for the quarter, they are a great customer of Salesforce to keep our eye on Twitter, and how do we manage Twitter, say transactions, we look at their transaction number how many tweets are happening in for Twitter. And in the same way, you can really look and you can track and graphing is quite analytical Salesforce’s transaction number over a period of time. So I will look to that and what I’ve seen is, I continue to come back to an amount with customers constantly that’s my job. This week I was in New York with dozens of customers and working with one of our – working with Bank of America’s, one of our largest customers on their next generation. Systems are and it’s all about their customer, you’re following the customer and how do you – the path of organic growth for our customers is the work with their customers. And that’s why we’re right in the heart of all these companies’ business. We want to help them grow their revenue. We want to help them grow their top line, and the way we are going to do that is by helping them optimize their sales, service, and marketing capabilities grow their channels, and as we do that, it’s reflected in the transaction numbers. So look, what is my call to arms? My call to arms is for all cloud ISVs to publish their transaction number on a quarterly basis just as we do, because it will give you more prospective on the stickiness and the intimacy and the integrity between the vendor and the customer. I hope that answers your question.

Your next question is from Brendan Barnicle with Pacific Crest Securities. Please go ahead with your question. Brendan Barnicle – Pacific Crest Securities: Thanks. Hi, Marc, I wanted to follow-up on – it’s been a while since the Rypple acquisition, and at that time you talked of sort of building a whole new class of apps that had more social integrated into them. I was wondering if you could give us a little more update on which of those have been most successful and sort of where you see that effort going.

Well, I of course, I’ll talk about Rypple, which is now known as Work.com and if you haven’t seen the new version of Work.com, it’s phenomenal. We’ve owned the company I think for just a little bit over a year now, a couple of incredible founders that joined our company from that company with Daniel Debow and David Stein. And under the leadership of a tremendous executive in our industry, John Wookey here at Salesforce who is running that capability, as well as our GoInstant acquisition, which is also another phenomenal story underway. but in the case of these small acquisitions that we’re doing like Rypple, like GoInstant and others, a lot of these are, what we are – acquisitions that we’re going to acquire talent and it’s a kind of extend and complement our capability. The one that we really kicked all this off with was Jigsaw. You probably remember when we bought Jigsaw for about $150 million and I don’t remember the exact amount. It’s not in front of me obviously at the table. And of course we’ve worked on that. We evolve the team. We evolve the products and the technology. We loosely coupled it into our architecture. We’ve rebranded in Data.com. And what this year Data.com had a phenomenal quarter they’re probably going to – I think they’re going to do more than $100 million this year. It’s pretty exciting or approximately that. They’re well on their way to doing that. And it’s a great success story here at Salesforce and it’s a commitment. I have to tell you we’re in quarter one or quarter two or even quarter five or six after buying a small company that’s not when we’re looking at is this a success or is this a failure. We want to get down the road, the year three or year four and that’s really when we can really judge it. In our industry, people always overestimating what you can do in a year and they’re underestimating what you can do in a decade and that is really true in these kind of technology acquisitions that we make. Now don’t make any mistakes, these are high risk moves when we buy a small company, there is a high risk that it’s going to fail and exceed. We have to keep these founders in the boat and it’s complex. But I’ll tell you that we’ve had a lot of great success and other great success in addition to Work.com, which is Rypple in addition to Data.com which was Jigsaw is the company called Heroku. And Heroku has also had some incredible growth rate. It hasn’t gotten yet to $100 million in revenue. We bought the company approximately 2.5 years ago for about $200 million to $250 million. It’s a phenomenal piece of technology and they have just done a great, great job at Heroku, it’s really become a great standard in the industry, it’s huge extension to our platform and gave a lot of confidence to our customers that we’re in the platform area. In the same way getting back to your original question, Work.com has become a tremendous performance in productivity enhancer to our sales application. And we see customers who are buying the sales cloud look to Work.com as a way to motivate and align and compensate their sales organizations. And you will see in the new version of Salesforce. This summer I’m not going to tip my hat too much, but the deep integration of Work.com into that next gen sales application. We’ve already seen us include some components of Work.com in the current vision of Salesforce and some customers have been able to deploy that. But soon all customers will be able to and it’s given us a great vision for the future of our company, and I couldn’t be more thrilled to have that group with us. They’re based in Toronto, Canada, and they’re doing a fantastic job. We want to keep them going fueled, and exciting. Thank you.

Your next question is from Nandan Amladi with Deutsche Bank. Please go ahead with your question. Nandan Amladi – Deutsche Bank: Hi, good afternoon. Thanks for taking my question, question on the off-balance sheet backlog. That seem to have slowed a little bit. We’re still up 33% year-on-year. But compared to where it was last year, was it tough comps or were there some other moving parts we need to understand?

Sure. There’s a couple of things. I think firstly, in Q1 last year, you’ll recall that we signed a largest deal in the company’s history that was signed in Q1 that added a big boost to the off-balance sheet, because it’s multiyear agreement. And also, we renewed one of our largest customers Japan Post for several years, and that’s also I think top five customers worldwide, and so those two transactions in the first quarter of last year made it kind of a tough comp. And then secondly, I think over the last few years, we’ve seen extension of our average contract length. We talked about that on our fourth quarter call that our average contract length is now just over two years, and at some point that the pace of that contract extension length will slow, and so that will provide a bit of a drag on that off-balance-sheet but it is still a very healthy growth rate of the tough comp. So we were happy with the number.

Your next question is from Keith Weiss with Morgan Stanley. Please go ahead with your question. Keith Weiss – Morgan Stanley: Excellent, thank you guys for taking my question and nice quarter. I just want to drill down on margins a little bit and one with a clarification, the licensing impact that was 90 basis points year-on-year on gross margins or operating margins?

It’s about the same, it’s about $8 million on our revenue numbers, so it basically got the same 90 point impact on, its recorded in cost of sales, so it was in the gross margin number and it was also obviously in the operating margin number.

Your next question is from David Hilal with FBR. Please go ahead with your question. Samad Samana – FBR: Hi, this is Samad Samana for Dave. We’ve been hearing lot of attraction in the government space; can you give us an update on the government focus and amongst your existing products where you see the biggest opportunity and which could be the most successful there?

Okay, yes, I will do that. As you know, Salesforce.com has not focused on the U.S. Government as a major opportunity over the last 14 years. We’ve been too emerged and amassed really in the commercial markets. It just has not been a major focus for us. A couple of years ago, we started to get much more excited about that opportunity and we really looked at how would we start to build and expand our capabilities. What we realized was that that would require us to do a couple of things; one, bring in new leadership to focus on not only the U.S. government but also the global government opportunity, which includes the Japan government or the U.K. government et cetera, as well as a new technology capability which would be to build the government, we call it government pod; that is, to build a pod that is a special version of our product that would be accessible only to the government, and that would allow critical agencies that we saw becoming interested in our technology like the GSA for example or others to become more invested in using our technology. We also had to bring in a new set of leadership and we hired Vivek Kundra who is our Executive Vice President of our Global Government business unit and he is based in Washington D.C. In addition to that, in addition to focusing upon building a new technology platform in addition to focusing on that next-generation leadership, we also recognized we had to spend a lot more time with the government and also do more marketing events in Washington D.C. And just as an example, yesterday, we had more than 2,000 customers attend our Washington D.C. program. Now, in addition to that, you may know that about 60 days ago, I also personally led a program in Washington D.C. myself which was a sub-1,000 seminar focused on government agencies as well. Now, these are primarily federal agencies; this is not – this does not also include our work in cities and also in states or in foreign governments. Overall, we see that as a tremendous opportunity for growth and we’re continuing to invest there. And as you know, it’s a long process, but we’re very excited by our work in a number of agencies, in a number of states, in a number of cities and we’ll be doing more to communicate that progress and success stories in the future. It’s wide-ranging from automating the GSA, which is the government’s determining arm to 311 call centers in a number of cities around the country to foreign governments, and I think a great example is Ministry of Economy, Trade and Industry that we talked about today with METI and what’s going on in Japan. So all of those things together make us very optimistic about our work with the government in the future, and I do think that the government is ready to go to the cloud.

Your next question is from Phil Winslow with Credit Suisse. Please go ahead with your question. Phil Winslow – Credit Suisse: All right. Thanks, guys. A lot of focus has been put on obviously Force.com and the Marketing Cloud. But just wanted to focus back in on the Service Cloud, just curious what trends you are seeing there? Obviously, you’ve had very strong momentum in the past, is that continuing? Then also competitively with write-down having been inside of Oracle for a bit, wondered if you could just talk about the competitive environment? Thanks.

I think that it’s really fascinating the competitive situation, because in our industry CEOs like myself tend to basically have to predict the future or do their best to predict the future and then focus in certain areas. And it’s a great example is – of course, Microsoft is extremely focused on Windows 8. That’s a huge part of their story. They’re trying to save their operating system business and their Office business through Windows 8, which they’ve seen Windows to accelerate very aggressively as the world has moved away from the personal computer and towards the phone and the tablet and with launching Windows 8 this year, Microsoft basically have said they want to be the Windows 8 company and that in all situations the answer is Windows 8. That’s true for SAP. You saw Sapphire last week and the main focus of Sapphire was HANA. The focus of HANA – this HANA application or that HANA implementation or even HANA in the cloud and SAP has said it’s the HANA company. And Oracle, I know Larry extremely well. He has a very impressive piece of technology with Exadata and he is very much wants to be the Exadata company, he views that as the future of the database and the future of its applications, and I get that and Oracle wants to be the Exadata company. But we don’t want to be the Exadata company or the HANA company or the Windows 8 company, we want to be the customer company. We want to enable our customers to help their customers connect in a new way, and that is along the lines of sales, service and marketing and the development of a customer platform. Number one, how do you market the customers when they are everywhere? Number two, how do you sell to customers as a team? Number three, how do you service the customers when they’re everywhere? Number four, how do you build a customer platform? Number five, how do you transform the way that you work in the world of social and mobile? These are the five things that I’m personally focused on each and every day at Salesforce. And look, when I’m working with customers in designing next-generation solutions, we’re looking at doing that. Let me give you an example. This quarter, we had really enjoyed working with Frank Blake, he’s the CEO of Home Depot, and his team on – they’ve got incredible new business in roofing and sidings and windows, and they need new applications rapidly, and we want to help build those applications, and we want to help connect them with their customers and help them build the quotes and the orders and the sales and service systems for their RSW business, which they see as a tremendous opportunity going forward, and I agree. And we have to get in there; we have to deliver with speed; that’s critical for their future success. And we also have to build and deliver that technology in radically different form factors than we were delivering in just 24 months ago. So when we’re working with our Home Depot in that environment, we’re coming in against existing and mass competitors in that organization. Of course, they really work with every customer and every vendor in the industry. We have to show that we’re different, and the way we’re going to show we’re different is, we’re able to take any device that they show us, rapidly deploy an application in that device and make it world-class and that’s what we did with Frank and his team this quarter. And that’s we have to reproduce in each and every situation around the world. And honestly, I think we’re doing a great job of that. I think you’re going to see – you saw some great new technology from us this quarter. If you haven’t seen what we’ve delivered on the app stores, it’s incredible. And this summer you’re going to see some more amazing things. We’re going to completely transform the CRM market, and by the time we get to Dreamforce, at the end of this year, I promise you, we will have completely transformed our vision and our core for CRM market and how we’re operating and we’re going to do in whether it’s a user interface or application programming interfaces. And I’ll tell you, it’s not a focus of our competitors, because if you go and look at their conferences that are seminars, they’re webinars, which I do, it’s my job to do that, they’re not focused in this area, they’re focused in other areas. And you know what; they probably should be focused in other areas because that’s their core. But our core is the customer here at Salesforce. And that’s what we’re focused on moving forward in sales and service and marketing and every day we want to move that technology down the field to make it more social, more mobile, more capable with Big Data, the ability to build and develop new next-generation communities, helping our customers become software companies like we just did with Home Depot in building these next-generation apps for them, get it deployed on the cloud and helping our customers build the next level of trust with their customers. And those seven tenants and those things that we’re doing every day, that is not what our competitors are doing. They’ve got a different focus. You can read their earnings – you can attend their earnings calls and read their scripts. It’s not what they talked about. So that’s how I look at the competitor situation and that’s why we’ve become the number one CRM company in the world.

Your next question is from Jason Maynard with Wells Fargo. Please go ahead with your question. Jason Maynard – Wells Fargo: Good afternoon guys. Marc, in your comments you’ve made some really interesting points about the shift to engagement apps and this new customer company point of view. Can you maybe share your vision around how Chatter, the new mobile apps, and the UI changes drive that positioning change?

Well, I think it’s a great question, and I’ll tell you that I am not ready to spill the beans which I’m very good at doing. What I’ll tell you is that the world is changing faster than ever and in our industry it’s no different. And you can really see it by what users are carrying with them when they even travel. I used to always have my laptop with me when I traveled, but now I mostly just have my phone. And that’s amazing to me. And I switch off between an iPhone and an Android device probably like a lot of people. Sometimes I have both with me. LTE networks have really changed this device performance everywhere I go in the world. And the phones are actually quite a bit bigger than they were just a couple of years ago, and I have seen some of the new phones that are coming, and they’re all starting to stretch a little bit more towards the iPad. I think that that is a very unusual and interesting change in our industry. It’s subtle, but it is seminal. And the reason why it’s seminal is, because it’s not the focus of the enterprise that all of a sudden I feel there like go in the pocket of my jacket and run my whole company, but that’s really my focus. My focus is and really has been that in the shift to mobility, which is way bigger than tablets and just phone – the billions and billions of devices are phones. In the world of social, which is billions of users in the social world and the world of next-generation Big Data, which is a lot about the APIs that are coming out of all these systems that we have to reconceptualize what does it mean to manage and build and create compelling enterprise software. The things that we were building when we started our company, we said hey, why are all enterprise apps not like Amazon? In 2010, we started to ask the question why our enterprise apps not like Facebook? Now, that was about a decade, but I can tell you that by the time that we get to – by the time that we get to Dreamforce, we have to build ask that same question. But in the same way that Facebook has reconceptualized their company and they run entirely on the phone. And they have these great new phone apps, which I use every day or Twitter – Twitter is another great example of phone apps. We have to be at that same level of acuity and excellence in that environment, not just for our fixed apps but in the ability to build and deliver custom apps, like I just referenced with some of these big customers. And this transformation or kind of the re-platforming – we’ve already re-platformed successfully a couple of times in the company, but I strongly believe we have to re-platform again in today’s world. I don’t see the competitors doing that honestly. And I really think that we have to do it again and we’re going to have to get ready to do it again because the market is changing. And it’s exciting and I think it’s getting bigger. I think our ability to reach more users is out there, and we want to build or provide a broader solution that’s agnostic across all operating systems and devices. That becomes the dominant applications that our customers use to manage their businesses. To back to Heather’s point that we want to have all of those apps right there in the palm of your hand and I think that we’ve got it figured out and I think we’re imminently ready to deliver the next-generation of our platform and our capabilities. Shinal we probably have time for about two more questions.

Your next question is from Walter Pritchard with Citi. Please go ahead with your question. Walter Pritchard – Citi: Hi thanks. Graham, I wonder if you could talk about deferred sales commission. If we look at the new deferred commissions on the cash flow that was actually down substantially year-over-year, but $32 million comes into about half of that. Can you talk about what the drivers of that number were?

Well I think we still have some comparison issues with Q1 and Q4 of the previous year, where we had sort of really, really spectacular large transactions closing that drove very high commission payments to sales teams that were involved in those transactions and clearly we have a strong fourth quarter here but we didn’t have some of these marquee transactions that really drive the big, big commission checks. So I mean other than that, we haven’t I would say year-over-year growth in terms of hiring is a bit slower this year versus the previous year but we haven’t changed the comp plans particularly or anything like that. So I think it’s really the profile and the distribution of the transactions that creates a lot of that change.

And your final question today comes from Raimo Lenschow with Barclays. Please go ahead with your question. Raimo Lenschow – Barclays Capital: Thank you. My question, just a quick one on the regions, I noticed that Asia has been decelerating of the two quarters and is actually growing at a growth rate, it doesn’t look overly exciting. Could you just talk about some of the drivers there? Thank you.

So Raimo, I think we have highlighted that on previous calls that in spite the fact that we obviously have some very large, very successful customers in Japan. Generally that market has been quite tough for us, over the last couple of years particularly in the enterprise. I think small businesses continue to kind of move along very nicely but enterprise in Japan has been slow and of course that takes time to kind of feed through into our revenue numbers. Now you are seeing obviously a different approach to managing the Japanese economy. We will be there next week for a customer company tour and I think our sales team over feel much more excited about the prospects for large enterprise transaction this year but it’s primarily Japan that is affecting that revenue growth number, the rest of Asia, which is sort of Australia, New Zealand and ASEAN has been relatively consistent performer over the last few years.

Great. Well, thanks everyone and thanks for joining us today. Just encourage you all again to register for Dreamforce, do that early and we look forward to updating you in August. Thanks very much.

Thank you everyone for joining today’s conference call. You may now disconnect.