Caesars Entertainment misses Q2 earnings expectations, shares edge lower
On Thursday, Salesforce.com, Inc. (NYSE:CRM) maintained its Buy rating and $400.00 price target from analysts at Needham. The company’s fourth-quarter fiscal year 2025 results showed revenue performance that aligned with expectations when adjusted for currency fluctuations, and exceeded profit estimates due to increased operational efficiency. According to InvestingPro data, Salesforce achieved an impressive gross profit margin of 76.94% and maintains a perfect Piotroski Score of 9, indicating strong financial health. Salesforce’s Current Remaining Performance Obligation (CRPO) growth reached 11% in constant currency, surpassing the forecast of 9%. This growth was attributed to stability in certain cloud services and a number of early renewals.
Salesforce’s product Agentforce was a focal point during discussions, with the company securing over 3,000 paid deals for the platform in the quarter. Additionally, the Data Cloud and Artificial Intelligence Annual Recurring Revenue (ARR) saw an impressive year-over-year growth of approximately 120%, reaching close to $900 million. The company’s overall revenue growth of 9.53% and total revenue of $37.19 billion in the last twelve months underscore these milestones, reflecting Salesforce’s expanding presence in the cloud computing sector and its successful integration of AI technologies.
However, the fiscal year 2026 guidance provided by Salesforce fell short of market expectations, an outcome that was not entirely unexpected given the recent change in the company’s Chief Financial Officer (CFO). The guidance conservatively assumes only a modest contribution from Agentforce. Despite this, there is potential for upside if the so-called "halo effect" from Agentforce continues to bolster broader platform adoption and drive monetization across other cloud services, including Sales, Service, and Data.
The positive performance in the recent quarter, particularly in areas like Agentforce deals and Data Cloud + AI ARR growth, suggests Salesforce is making strides in its product offerings and market reach. The company’s strategic focus on operational efficiencies has also translated into a stronger bottom line, a trend that may continue to support its financial outlook. With the FY26 guidance set conservatively, any outperformance could provide additional momentum for the company’s shares. For deeper insights into Salesforce’s valuation and growth potential, InvestingPro subscribers can access comprehensive analysis, including 12 additional ProTips and detailed financial metrics in the Pro Research Report.
In other recent news, Salesforce’s fourth-quarter earnings report showcased mixed results, with non-GAAP earnings per share of $2.78 surpassing expectations, while revenue of $9.99 billion fell short of projections. This performance led several analysts to adjust their price targets for the company. Raymond (NSE:RYMD) James decreased its target to $375, maintaining a Strong Buy rating, while DA Davidson lowered its target to $275, keeping a Neutral stance. Evercore ISI, however, maintained a $420 target, reiterating an Outperform rating, and Goldman Sachs held its $400 target with a Buy rating. JMP Securities also revised its price target to $430 from $450, retaining a Market Outperform rating.
Salesforce’s growth outlook for fiscal year 2026 was a focal point, with expectations of 7%-8% revenue growth, which includes a 0.5% impact from foreign exchange headwinds. Analysts highlighted various factors influencing Salesforce’s future performance, including the adoption of its Data Cloud and Agentforce platform. Despite some concerns over revenue growth, Goldman Sachs and Evercore ISI expressed optimism about Salesforce’s potential for margin improvement and revenue acceleration in the coming quarters. The company’s strategic initiatives, such as AI enhancements, are expected to drive growth amidst challenges in the professional service and marketing segments.
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