Salesforce Chairman and CEO Marc Benioff spoke at CNBC’s Squawk Box on January 22, 2025 outside the World Economic Forum in Davos, Switzerland.
Jerry Miller | CNBC
Salesforce Stocks fell about 3% despite lifting year-round guidance from artificial intelligence tailbone, surpassing Wall Street’s first quarter estimates.
The sales and customer service software giant said it expects to earn $11.27 to $11.33 in adjusted revenue per share and $41.3 billion for the fiscal year. This comes from previous guidance that required an adjusted EPS of $11.09 to $11.17 and $40.5 to $40.9 billion.
“Q1 is not a game change, but it refers to a stable demand environment and continues to have a strong presence in Agent Force’s new product cycle,” wrote City Analyst Tyler Radke.
Salesforce results come the day after the company announces its intention to purchase a data management company Informatica For $8 billion as we strengthen our AI offerings. The transaction marks the company’s biggest acquisition since the Slack transaction.
JP Morgan analyst Mark Murphy believes that some post-revenue movements have been slightly overlooked in the growth of its current remaining performance obligations in the second quarter. The company also posted small operating margin mistakes, he added.
“After multiple quarters of beat/margin, a small first quarter mistake and repetition is a print choice,” said Keith Weiss of Morgan Stanley.
Despite the positive results, RBC Capital Markets downgraded its stock from outperform to performance. Analysts also questioned the company’s Informatica needs and whether it could interfere with its core business.
“I stepped in and liked the margin expansion story at Salesforce, and although the ratings are not consistent, the risk of trading with Informatica has turned the scale upside down for us,” analyst Rishi Jaluria said.
Recent tariff uncertainty has spurred a significant volatility for technology companies that rely on goods imported from overseas. Weiss called the result “better than feared” against the background of turbulence.
“With macro concerns and the potential recession, it’s once again great to see companies offer inline quarters with no visible macro effects,” said Mark Maudler of Bernstein.
Net income was $1.54 billion, or $1.59 per share, year-on-year. A year ago, net income reached $1.53 billion, or $1.56 per share.
Adjusted revenue for the first quarter was adjusted at $2.58 per share, exceeding the $2.54 estimate from LSEG. Revenues rose nearly 7.6% from a year ago to $9.83 billion, surpassing the $9.75 billion estimate.
Watch: Salesforce CEO Marc Benioff goes one-on-one with Jim Cramer
