Salesforce, the cloud computing and customer relationship management (CRM) software giant, delivered positive news regarding its artificial intelligence (AI) product adoption. While revenue for the previous quarter slightly missed expectations, the company provided unexpectedly strong guidance for the current quarter, reflecting its success in convincing customers to invest in its AI offerings.

Salesforce’s guidance suggests that revenue in the current quarter will achieve double-digit growth for the first time in nearly two years, surpassing Wall Street’s expectations of a return to 10%+ growth. This acceleration is partly attributed to its acquisition of data integration software maker Informatica. Additionally, the Current Remaining Performance Obligation (CRPO), a key financial metric tracking contracted but unfulfilled revenue, maintained double-digit growth.

Analysts noted that while CRPO guidance indicates soft enterprise spending, the successful adoption of Salesforce’s AI platform Agentforce and data platform Data 360 has fueled optimism. They project these products could become significant revenue drivers starting in the second half of 2026.

Following the earnings release, Salesforce shares, which closed up 1.7% on Wednesday, surged nearly 8% in after-hours trading. Year-to-date, the stock has declined 28.6%, reflecting concerns that Salesforce—a pioneer in software-as-a-service (SaaS)—has not benefited from the AI transformation but instead suffered from recent AI bubble fears.

**Key Financial Data (Q3 FY2026, Ended October 31, 2025):** - **Revenue**: $10.26 billion, up 8.6% YoY (guidance: $10.24B–$10.29B; consensus: $10.28B). - **EPS (Non-GAAP)**: $3.25, up 34.9% YoY (guidance: $2.84–$2.86; consensus: $2.86). - **Operating Margins**: GAAP at 21.3% (+1.3pp YoY); Non-GAAP at 35.5% (+2.4pp YoY).

**Business Highlights**: - **Subscriptions & Support**: Revenue rose 9.5% YoY to $9.73 billion. - **CRPO**: Grew 11% YoY to $29.4 billion, slightly above expectations.

**Guidance (Q4 FY2026)**: - **Revenue**: $11.13B–$11.23B (+11.3%–12.3% YoY; consensus: $10.91B). Full-year guidance raised to $41.45B–$41.55B (prior: $41.1B–$41.3B). - **EPS (Non-GAAP)**: $3.02–$3.04 (consensus: $3.03). Full-year EPS adjusted to $11.75–$11.77 (prior: $11.33–$11.37).

**AI and Data Cloud Momentum**: CEO Marc Benioff highlighted that Agentforce and Data 360 (formerly Data Cloud) achieved annualized recurring revenue (ARR) of $1.4 billion, up 114% YoY. ARR grew 17% sequentially, maintaining triple-digit growth trends in 2025.

**Valuation and Market Sentiment**: Pre-earnings, Salesforce’s valuation hit its lowest since its 2004 IPO, with a forward P/E of ~19x—below its 10-year average (47x) and the S&P 500’s 22x. Morgan Stanley noted SaaS stocks have fallen 12% YTD amid AI disruption fears. Investors worry AI automation may reduce demand for per-user software licensing.

Despite Salesforce’s long-term vision of $60B+ revenue by 2030 via AI and automation, its stock reflects skepticism. Analysts, including Citi’s Tyler Radke, remain cautious, citing limited real-world adoption of Agentforce despite its potential.

The broader macro environment exacerbates concerns, with central banks and analysts warning of AI bubbles and overbuilt data centers. While Nvidia and hyperscalers dominate AI infrastructure, slower-growing SaaS firms like Salesforce face a dilemma: too late for the AI hype, yet too exposed to avoid its risks.

Salesforce’s AI products, including Agentforce (launched October 2024), show promise but lack near-term financial impact. Wall Street’s unchanged earnings forecasts for the past 12 months underscore lingering doubts about its AI-driven growth trajectory.