We're raising our price target on Salesforce after results defy 'SaaSpocalypse'
Salesforce's numbers and guidance were strong. Plus, a new partnership with Anthropic offers another reason for optimism.
TL;DR
- Salesforce exceeded revenue expectations for its fiscal second quarter, reporting $11.35 billion.
- The company issued strong guidance for the current period, indicating a reacceleration of growth.
- A new product integration with Anthropic's Claude chatbot aims to leverage customer data for AI applications.
- Salesforce's stock rose significantly following the announcements, reaching levels not seen since early 2026.
- CEO Marc Benioff has been vocal in countering the 'SaaSpocalypse' narrative, asserting AI's complementary role to SaaS.
- Slack, a previously criticized acquisition, showed strong performance with triple-digit bookings growth and accelerated net new AOV growth.
- Agentforce and Data 360 combined ARR shows significant year-over-year growth, indicating strong performance for Salesforce's AI initiatives.
- The company's current remaining performance obligation (cRPO) increased by 14% year-over-year, signaling future contracted revenue.
- The partnership with Anthropic, dubbed 'Claudeforce', integrates Salesforce's customer data with Claude's conversational AI capabilities.
- Third-quarter guidance projects revenue between $11.42 billion and $11.5 billion, with revenue growth of 11% to 12% on a constant currency basis.
- Full-year guidance remains unchanged for adjusted operating margin and free cash flow growth.