Salesforce provided investors with an outlook for annual sales that fell short of analysts’ expectations, suggesting that it has not yet benefited from its increased investments in artificial intelligence.
The San Francisco-based company said it expects revenue to increase by about 9% to between $37.7 billion to $38 billion for the 2025 fiscal year, below analysts’ expectations of $38.62 billion. The news initially sent Salesforce’s stock down by as much as 6% in trading after the market closed, although it has since rebounded. The stock has gained 83% over the past year as the company quickly expanded margins.
The customer-management software developer posted $9.29 billion in revenue for the fourth quarter of 2023, above the $9.21 billion expected by analysts. Salesforce also reported net income of $1.45 billion, or $1.47 per share, compared with a loss of $98 million, or 10 cents per share, for the same period last year.
Like many technology firms, Salesforce has been pushing investment in new AI-based features to boost sales. On Tuesday, Salesforce unveiled its Einstein Copilot, a new generative AI assistant that can answer questions and generate new content. During a call with investors, CEO Marc Benioff teased bringing “even more AI innovation” to customers on March 6 at Salesforce’s Trailblazer DX conference in San Francisco.
“Is this our future? Do we really know what’s going to happen?” Beinoff said about AI on the earnings call. “You know, at the end of the day, we all know that everything is underway with AI, the future is unfolding between our eyes.”
Salesforce also said it would expand its stock buyback program by $10 billion — to a total of $30 billion — and announced its first quarterly dividend of 40 cents per share. Notably, the software giant laid off 10% of its workforce last month as part of a restructuring plan to cut costs.