Salesforce stock was down almost 8% this morning after a disappointing earnings report last night.
The company shared third quarter revenue forecast that came in below expectations and investors worry that has to do with AI monetization problems.
The company is all-in on AI, but Wall Street’s patience for the ROI countdown is running thin it seems. At least it’s running thin enough that even though second-quarter revenue came in pretty good and the company shared a $20 billion increase to its existing share buyback program, that was not enough to quell investor worries.
Salesforce, which provides customer relationship management (CRM) software to companies, is betting its entire future on AI as office work gets automated.
That push is centered around its product Agentforce, a platform of AI agents that can completely automate some CRM processes. The platform is directly wired into company data and can generate personalized emails to clients, spit out sales pitches, and come up with marketing campaigns.
Since launching the product last October, the company has closed over 12,000 deals, of which more than 6,000 are paid customers, the company said in the press release.
The irony is that as Salesforce contends with the automation of its CRM software, the company is also undergoing a major automation of its own workforce. Earlier this week, CEO Marc Benioff said that Salesforce had cut more than 4,000 customer service roles to have AI agents do the work instead.
Salesforce is only one of the many symbols of investor anxiety about when the huge investments in AI will start paying off. Could AI hype slowly be facing reality? The reactions so far might show that investor mood is more “meh” than “wow.”
1. Salesforce’s struggles
The company’s stock is down more than 20% this year, marking one of the worst performances in large-cap tech stocks. The decline was the second-steepest in the Dow, CNBC reported, beating only the deeply troubled UnitedHealth.
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