Salesforce's AI-Fueled Growth Ignites Buying Opportunity

Salesforce's decline this year was largely due to fears that artificial intelligence would replace it and reduce its market share. However, the company has been using AI to drive meaningful revenue growth and engagement, particularly with its agentic AI technology.

The company's CEO, Marc Benioff, said that agentic AI is 'the biggest growth opportunity for our customers.' Salesforce has crossed $1 billion in Agentforce annual recurring revenue and delivered 3.8 billion Agentic Work Units to its customers, showing strong demand.

Revenue for the fiscal 2027 first quarter was up by 13% year over year, with agentic AI contributing significantly to this growth. The company also expects $11.31 billion in revenue at the midpoint of its fiscal 2027 second-quarter guidance, implying 10-11% year-over-year growth.

The valuation of Salesforce has become much cheaper due to the prolonged correction and stronger fundamentals, trading at a P/E ratio of 21 compared to above 40 less than one year ago.