So here's a fun thing about being a big software company these days: you can have a whole business unit that's growing like a weed, and it can still feel like you're playing defense against the bears. That's kind of where Salesforce Inc. (CRM) finds itself, according to a new note from Goldman Sachs.
Analyst Gabriela Borges is out with a fresh take, and while she did trim her price target from $330 to $281, she's still firmly in the Buy camp. Why? One word, or rather, one platform: Agentforce.
For those not keeping a detailed scorecard of Salesforce's sprawling empire, Agentforce is the company's platform for building and deploying autonomous AI agents. Think of it as the factory floor for the next generation of AI-powered customer service and sales bots. And business, it seems, is booming.
Borges points out that Agentforce generated a whopping 50% sequential growth last quarter. More impressively, its annual recurring revenue (ARR) has ballooned to $800 million. That's a 169% increase from where it was a year ago. In the world of enterprise software, that's the kind of hockey-stick growth that gets analysts' attention and, presumably, makes the competition a little nervous.
"We expect the most meaningful Agentforce tailwinds in Sales and Service," Borges wrote, suggesting this isn't just a flashy side project but a core engine for future growth in Salesforce's main businesses.
This strong performance from Agentforce is why Borges believes it will be "key to driving positive estimate revisions and refuting [the] bear case" on the stock. It's the shiny new thing that helps offset other, more mundane concerns.
Speaking of which, the broader financial picture was a bit of a mixed bag. The company's recent quarterly revenue, subscription revenue, and EBIT margin all came in right in line with what Wall Street was expecting. Looking ahead, management's guidance for fiscal 2027 revenue and subscription revenue also matches consensus. The one slight blemish? The forecast for EBIT margin is about 60 basis points below what analysts had penciled in.
Investors, however, seemed focused on the Agentforce growth story. Shares of Salesforce were up 3.33% to $198.13 following the analyst's bullish take. Sometimes, it's not about beating every single estimate, but about showing you have a powerful new growth lever to pull. For now, it looks like Salesforce is pulling that lever pretty hard.
