Salesforce Plummet: Bad News for Salesforce Investors?

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Salesforce’s Revenue Stumbles, Shares Plunge 17%

**LA News Center**

A Weather Forecast of Disappointment

Salesforce, a cloud software giant, hit a rough patch on Wednesday, with its shares nosediving 17% in extended trading. This financial storm was triggered by a downpour of weaker-than-expected revenue figures and a gloomy guidance that fell below Wall Street’s expectations.

Revenue Rain Fails to Quench Thirst

Despite analysts’ consensus, Salesforce’s revenue fell short, barely reaching .13 billion compared to the anticipated .17 billion. This revenue drizzle brought a dismal 11% growth, falling short of the previous year’s 20% surge.

Earnings Shine, but Not Enough to Dazzle

On the earnings front, Salesforce managed to meet analysts’ expectations, reporting .44 per share, adjusted. However, this glimmer of hope was overshadowed by the revenue shortfall.

Guidance Paints a Bleak Picture

Salesforce’s guidance for the current quarter cast an even darker cloud. Its earnings per share are projected to range from .34 to .36, and revenue is estimated to hover between .2 billion and .25 billion. These forecasts fell well below analysts’ estimates of .40 in adjusted earnings per share and .37 billion in revenue.

Silver Lining: Fiscal Forecast Lifted

Amidst the gloom, Salesforce did offer a glimmer of optimism. It revised its earnings forecast for the 2025 fiscal year upward. The company now predicts adjusted earnings of .86 to .94 per share, higher than the previous estimate of .68 to .76. However, its revenue guidance remained unchanged.

AI-Powered Products Take Center Stage

As Salesforce navigates these challenging waters, it is anchoring its hopes on its AI-powered offerings. During the quarter, the company launched Einstein Copilot, an AI assistant designed to aid sales and customer service representatives. Additionally, it granted paid Slack users access to AI features such as conversation summaries and daily recaps.

Market Reaction: A Nosedive on Wall Street

Before the after-hours plunge, Salesforce shares had enjoyed a 3.5% increase this year. However, Wednesday’s financial storm reversed these gains, dragging the company’s performance below the S&P 500 index’s impressive 11% growth.

Execs to Spill the Beans

Salesforce’s top brass will engage in a conference call with analysts at 5 p.m. ET to delve deeper into the company’s financial woes. As they unveil the reasons behind this disappointing performance, investors will anxiously listen for clues about the future of this tech giant.

Data sourced from: cnbc.com