Shares of customer relationship management (CRM) leader (CRM -0.44%) are rallying back toward their all-time high set last autumn.

The cloud software giant posted financial results that handily beat its own expectations for the second quarter of fiscal 2022 (the three months ended July 2021), and CEO Marc Benioff and his team had plenty of good news to report on continued long-term momentum. This top cloud stock remains a buy in my book following the earnings update for three reasons.

1. The core business is still going strong

Salesforce's revenue increased 23% year over year to $6.34 billion -- its first-ever quarter with over $6 billion in sales. Leading the charge with a more than 24% year-over-year increase to $1.88 billion was the largest of its four reporting segments, the "platform and other" unit, primarily made up of data management outfits MuleSoft and Tableau.  

Three people using laptops at an outdoor cafe.

Image source: Getty Images.

Momentum is picking up, primarily because of the recent tie-up with Slack as well as the purchase of IT consulting firm Acumen Solutions, announced late in 2020. Slack and Acumen are expected to contribute $530 million and $200 million in revenue, respectively, during the second half of this year.

Those are big numbers, but considering Salesforce overall is forecasting full-year revenue to be at least $26.2 billion (a 23% annual increase, and up from previous guidance for as much as $26 billion), it's Salesforce's existing core business that is still driving results higher right now.

In all, the increase in the revenue forecast implies Salesforce's existing business will haul in some $260 million more than previously thought. Even when backing out recent takeovers, Salesforce is still growing at a high teens percentage rate, putting it on track to reach Benioff's goal of $50 billion in sales by fiscal year 2026 (which corresponds to calendar year 2025).  

2. Slack is the new "digital HQ" for many organizations

As good as Salesforce's core business growth has been, there is still a fair amount of criticism for the Slack takeover. At some $28 billion paid out in a combination of cash and new Salesforce stock, it's by far Salesforce's largest purchase in a long string of takeovers that have augmented the CRM leader's operations over the past two decades. 

But Slack will be the biggest ever not just because of the price tag (management said stand-alone Slack sales grew 39% year over year in Q2, implying it brought in about $300 million in revenue). Salesforce has wasted no time making Slack the operating system for its Salesforce 360 CRM software suite.

With remote work and cloud-based operations now cemented in place as part of the new business normal, having Slack at the core of the Salesforce platform is a big deal. As Benioff and his team referred to it on the earnings call, Slack -- as well as Zoom Video Communications (NASDAQ: ZM) -- are the new "digital HQ" for many organizations these days.

Rather than commute to the office, many workers now make a far shorter trip to their home office and immediately log in to Slack to start their day. Slack is thus helping Salesforce land new customer deals and expand on existing ones. A long list of new and expanded relationships mentioned on the earnings call include IBM (NYSE: IBM), PayPal (NASDAQ: PYPL), Coinbase Global (NASDAQ: COIN), and Vodafone (NASDAQ: VOD).

Price tag aside, I expect Slack will feature prominently in the years ahead as Salesforce increasingly goes toe-to-toe with Microsoft (MSFT 0.09%) as a leading enterprise software firm.  

3. A value-generation machine for stakeholders

Even when factoring in all the costs associated with Salesforce's acquisition-heavy strategy, this is still a highly profitable outfit. It raised its expected operating profit margin for full-year fiscal 2022 to a range of 14% to 15% (from the previous 12% to 13%). Excluding acquisition-related expenses, free cash flow generated through the first half of this year was $3.23 billion, up 75% from the same period last year and good for a free cash flow profit margin of 26%.

Of course, a common argument that's made is that Salesforce issues lots of new stock to pay for its expansion. As usual, I counter with this metric:An incredible growth in free cash flow per outstanding share over the last decade. Even when taking Slack into account, Salesforce continues to deliver incredible profit growth for shareholders.

CRM Free Cash Flow Per Share Chart showing upward trend.

Data by YCharts.

At about 48 times trailing-12-month free cash flow, I say Salesforce stock is still a fantastic buy. This cloud computing leader is growing at a brisk pace, highly profitable, and quickly going from a CRM software niche to the very fabric of operations for thousands of organizations around the globe. Salesforce remains a great company to make a core holding in your portfolio.