Salesforce Raises Revenue Forecast, Betting Big on AI and Cloud Spending

Salesforce raises annual revenue forecast

May 28 (Reuters) - Salesforce (CRM.N), opens new tab raised its revenue forecast for fiscal 2026 on Wednesday, as the enterprise software provider ramps up monetization of its artificial intelligence agents in a bid to reinvigorate growth. The company expects revenue to be between $41 billion and $41.3 billion, compared with its prior forecast range of $40.5 billion to $40.9 billion. Reporting by Zaheer Kachwala in Bengaluru; Editing by Alan Barona Our Standards: The Thomson Reuters Trust Principles., opens new tab Suggested Topics:Artificial IntelligenceShareholder Activism

Salesforce shares fall as software maker shows pockets of weakness

The sales and customer service software giant said it now expects $11.27 to $11.33 in adjusted earnings per share and $41.0 billion to $41.3 billion in revenue for the fiscal year. That's up from previous guidance that called for adjusted EPS between $11.09 and $11.17 and $40.5 billion to $40.9 billion in revenue. "Q1 results, while not game changing, point to a stable demand environment, with continued strength in the Agentforce new product cycle," wrote Citi analyst Tyler Radke. Salesforce's results come a day after the company announced its intent to buy data management company Informatica for $8 billion as it beefs up its AI offerings. The deal would be the company's largest acquisition since its Slack deal. JPMorgan analyst Mark Murphy attributed some of the post-earnings move to a slight miss on current remaining performance obligation growth for the second quarter, which he said came in 30 basis points below Wall Street's expectations. The company also posted a slight operating margin miss, he added. "After multiple quarters of beats/raises to margin, the slight Q1 miss and reiteration is a pick on the print," said Morgan Stanley's Keith Weiss.

Salesforce raises annual results forecast on strong cloud spending

Higher cloud spending bodes well for Salesforce's efforts to ramp up monetization for its AI agent platform, Agentforce, as it bets big on agentic technology to spur adoption of its software offerings. The company said it closed over 8,000 deals since launching Agentforce, with half of them already paid. Its Data Cloud and AI annual recurring revenue has exceeded $1 billion.Salesforce raised its revenue and adjusted profit forecasts for fiscal 2026 on Wednesday, as the enterprise software provider benefits from strong cloud spending while ramping up monetisation of its artificial intelligence agents. Cloud spending from major enterprises has remained resilient even amid global macroeconomic uncertainty over the past few months, as companies invest heavily in artificial intelligence to modernize their digital infrastructure. Shares of the company were up around 1.5% in extended trading. Higher cloud spending bodes well for Salesforce's efforts to ramp up monetization for its AI agent platform, Agentforce, as it bets big on agentic technology to spur adoption of its software offerings. The company said it closed over 8,000 deals since launching Agentforce, with half of them already paid. Its Data Cloud and AI annual recurring revenue has exceeded $1 billion. While Agentforce's monetization has underperformed investors' expectations, "experts have cited a multi-billion dollar revenue opportunity by the end of 2026, with the expectation that Agentforce will ultimately become Salesforce's largest revenue contributor," said Third Bridge analyst Charlie Miner. Salesforce bought data management platform Informatica for about $8 billion on Tuesday to bolster its data tools. The company's re-entry into big-ticket M&A after years on the sidelines sparks concerns about Salesforce's ability to return to double-digit growth without relying on acquisitions. "The acquisition of Informatica represents an attempt by the company to compensate for the slowing organic growth," said Gil Luria, analyst at D.A. Davidson. The company expects fiscal 2026 revenue to be between $41 billion and $41.3 billion, compared with its prior forecast range of $40.5 billion to $40.9 billion. It raised its full-year forecast for adjusted earnings per share to a range of $11.27 to $11.33, compared to its previous forecast of $11.09 to $11.17 per share. The company reported first-quarter revenue of $9.83 billion, beating estimates of $9.75 billion, according to data compiled by LSEG.

Salesforce raises annual results forecast on strong cloud spending

(Reuters) - Salesforce raised its revenue and adjusted profit forecasts for fiscal 2026 on Wednesday, as the enterprise software provider benefits from strong cloud spending while ramping up monetization of its artificial intelligence agents. Cloud spending from major enterprises has remained resilient even amid global macroeconomic uncertainty over the past few months, as companies invest heavily in artificial intelligence to modernize their digital infrastructure. Shares of the company were up around 1.5% in extended trading. Higher cloud spending bodes well for Salesforce's efforts to ramp up monetization for its AI agent platform, Agentforce, as it bets big on agentic technology to spur adoption of its software offerings. The company said it closed over 8,000 deals since launching Agentforce, with half of them already paid. Its Data Cloud and AI annual recurring revenue has exceeded $1 billion. While Agentforce's monetization has underperformed investors' expectations, "experts have cited a multi-billion dollar revenue opportunity by the end of 2026, with the expectation that Agentforce will ultimately become Salesforce's largest revenue contributor," said Third Bridge analyst Charlie Miner. Salesforce bought data management platform Informatica for about $8 billion on Tuesday to bolster its data tools. The company's re-entry into big-ticket M&A after years on the sidelines sparks concerns about Salesforce's ability to return to double-digit growth without relying on acquisitions. "The acquisition of Informatica represents an attempt by the company to compensate for the slowing organic growth," said Gil Luria, analyst at D.A. Davidson. The company expects fiscal 2026 revenue to be between $41 billion and $41.3 billion, compared with its prior forecast range of $40.5 billion to $40.9 billion. It raised its full-year forecast for adjusted earnings per share to a range of $11.27 to $11.33, compared to its previous forecast of $11.09 to $11.17 per share. The company reported first-quarter revenue of $9.83 billion, beating estimates of $9.75 billion, according to data compiled by LSEG. (Reporting by Zaheer Kachwala in Bengaluru; Editing by Alan Barona)

Salesforce Raises Fiscal Year Sales Outlook After 1Q Beat -- 2nd Update

Salesforce raised its full-year sales outlook after first-quarter earnings and revenue rose, as artificial intelligence continues to boost its business. The customer-relationship management platform on Wednesday raised its full-year sales outlook to $41.0 billion to $41.3 billion, up from previous guidance of $40.5 billion to $40.9 billion. Salesforce said its investments in artificial intelligence are building momentum, with subscription growth in that business more than doubling. Small- and medium-market businesses both had double-digit growth in new bookings. Salesforce guided higher numbers than Wall Street had been anticipating for the current second quarter. "It really surprised us," Chief Executive Marc Benioff said. "Sometimes you have a quarter when everything is going right for you." Shares rose 1.8% to $280.90 in after-hours trading Wednesday. The San Francisco company expects sales in the second quarter to be $10.11 billion to $10.16 billion, ahead of the $10.02 billion analysts were expecting. Earnings per share are anticipated to be $1.80 to $1.82, beating Wall Street's estimate of $1.72 a share. Revenue in the first quarter rose 8% to $9.83 billion, ahead of both Wall Street and company expectations. Analysts surveyed by FactSet forecast revenue of $9.75 billion, and Salesforce had guided for up to $9.76 billion. The bump in sales was partly driven by its data cloud and AI business, where annual recurring revenue more than doubled to $1 billion. The company has now closed 8,000 deals with its AI chatbox platform Agentforce, up by about 3,000 from the prior quarter. Salesforce is investing heavily in AI as it works to further develop Agentforce, which debuted in October. The company said Tuesday it would acquire data-management software provider Informatica in an $8 billion deal. The acquisition isn't anticipated to affect Salesforce's full-year guidance since it is scheduled to close in early fiscal 2027, the company said Wednesday. "We've pivoted the entire company around our vision of AI," Benioff said. The deal is Salesforce's largest since it bought Slack Technologies in 2021 and is expected to help improve its artificial-intelligence product Agentforce. Salesforce launched Agentforce in October as an AI agent that automates tasks from a prompt and is designed for use in human resources, information technology and financial reporting. Salesforce posted a profit of $1.54 billion, or $1.59 a share, in the quarter ended April 30, compared with $1.53 billion, or $1.56 a share, a year earlier. Stripping out certain one-time items, adjusted per-share earnings were $2.58, ahead of the $2.55 forecast by analysts, according to FactSet. Write to Katherine Hamilton at [email protected]