Salesforce exceeds expectations and raises annual forecast

12/5/2024, 7:47 PM

Salesforce impresses with strong quarterly growth, optimistic forecasts, and innovative AI solutions, driving the stock to a new record high.

Eulerpool News Dec 5, 2024, 7:47 PM

Salesforce, the American industry leader in customer relationship management software, exceeded analysts' expectations with its results for the third fiscal quarter of 2024/25 and raised its annual forecast. Investors reacted positively, and the stock increased significantly in after-hours trading.

In the past quarter, Salesforce increased revenue by over 8 percent to $9.44 billion. The adjusted operating profit margin was 33.1 percent, while net income rose by a quarter to $1.5 billion. This clearly exceeded market expectations.

For the current fiscal year, Salesforce now expects revenues between 37.8 and 38 billion US dollars, slightly above the previous forecast. The adjusted operating margin is expected to reach 32.9 percent, also a slight increase. "We see significant growth opportunities, especially in the field of artificial intelligence," emphasized CEO Marc Benioff.

The focus of the positive development is the AI platform Agentforce introduced in October. This enables companies to develop autonomous AI agents that can optimize processes, develop marketing strategies, or train sales staff. The first contracts have already been concluded, with the full financial effect only becoming visible in future quarters.

Benioff also announced that Salesforce would hire 1,000 new employees to promote the Agentforce business. This expansion marks a reversal after the company had implemented cost savings and job cuts in the past two years.

Salesforce stock rose by more than 10 percent to $366 after the quarterly figures and reached a new record high. So far this year, the stock has gained about 40 percent. Analysts rated the results mostly positively: While the margin increase has lost some momentum, an upswing in investments in software solutions is expected.

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