Salesforce CEO Marc Benioff explains why he suddenly went on a $4 billion buying craze this year

Salesforce has been scooping up companies at an unprecedented rate, spending roughly $4 billion on acquisitions this year alone.

That's raised concerns among some investors, as Salesforce CEO Marc Benioff was even reported to have tried to outbid Microsoft's $26 billion offer for LinkedIn at one point. Salesforce had $2.7 billion in total cash at the end of 2015.

So during Salesforce's earnings call Wednesday, Benioff offered an explanation for his sudden spending spree. Apparently, acquisitions weren't even part of Salesforce's plan at the start of this year, but it changed its M&A strategy after seeing so many good companies came up for sale at a reasonable price.

Benioff said:

"We came into this year and we didn't really have M&A on our forecast. But then there were some pretty big changes that happened in the market...It's been an incredible time for us to acquire some phenomenal assets and I've never been more excited about Salesforce and our pipeline."

Benioff says LinkedIn was the first company that really opened him up to acquisitions, as the company's stock crashed nearly 50% after weak earnings in February. Although Salesforce ended up losing the bid to Microsoft, Benioff famously told LinkedIn CEO Jeff Weiner that he would have been willing to pay much more for LinkedIn had he been given the chance.

"When that happened, it really triggered our process because all of a sudden a great company that is a unique asset, that's strategic, was available at a great price," Benioff continued.

Beating our numbers

Then the e-commerce software maker Demandware became available, and when Benioff heard it was up for sale, he didn't hesitate to outbid the other bidder, who's widely believed to be Adobe. Salesforce ended up paying $2.8 billion for Demandware.

For Quip, which Salesforce paid $750 million to acquire, it wasn't just about the product, but also because of its CEO Bret Taylor who Benioff says will be one of his company's "top technical leaders." Then a number of smaller artifical intelligence startups were acquired to help build a new product called "Einstein" that's set to debut later this year.

But despite all the acquisitions, which will of course help grow the company's top-line revenue, Benioff stressed that he's also laser focused on the continued expansion of Salesforce's profit margin. Salesforce improved its non-GAAP operating margin again this quarter to 12.9%, its 9th straight quarter doing so, and also recorded net income of $229 million.

"I'm very committed to top line growth, but I'm also committed to bottom line growth. We'll continue to do that while being able to participate in this M&A environment, because, as you can see, we not only bought companies but we also beat our numbers," Benioff said.