The CEO of Salesforce, Marc Benioff, is well-known for stirring up debates, particularly when he takes aim with sharp criticism and pointed remarks aimed at Microsoft‘s AI endeavors.
In the latest episode, following the release of the company’s financial report, Salesforce surprisingly reported lower than anticipated quarterly income.
In terms of the financial report, the company saw an adjusted earning per share of $2.78, which was 17 cents higher than what financial analysts had anticipated. On the other hand, their reported revenue came in slightly lower than expected at $9.99 billion, compared to the forecasted $10.04 billion.
Last year, Salesforce saw a growth of 7.6% in its total revenue, and its net earnings climbed up to an impressive $1.71 billion, which was previously $1.45 billion.
In simpler terms, the largest source of the company’s income from subscriptions and support was its service sector, totaling approximately $2.33 billion, which saw an 8% growth. Additionally, it earned around $2.13 billion from its sales segment.
It’s significant to mention that during the last quarter, the company introduced their AI-driven technology named Agentforce, which appears to be developing into a profitable venture.
According to Salesforce, they’ve closed around 3,000 transactions involving Agentforce (paid service) since last October, and their AI agent has taken part in approximately 380,000 discussions on their support site.
From my perspective as an analyst, it’s quite intriguing to note that human intervention was necessary just 2% of the time. As reported by the CEO of Salesforce, this suggests a high level of automation and efficiency in our systems.
Many competitors discuss their agent functionality, yet only a handful can demonstrate it functioning effectively on a large scale.
Salesforce Projected Growth and Financial Year 2026 Forecast
Salesforce Revenue Growth: Estimated $40.9 billion for FY26 (guidance)
– FY25: $37.9 billion
– FY24: $34.9 billion
– FY23: $31.4 billion
– FY22: $26.5 billion
– FY21: $21.3 billion
– FY20: $17.1 billion
– FY19: $13.3 billion
– FY18: $10.5 billion
– FY17: $8.4 billion
– FY16: $6.7 billion
– FY15: $5.4 billion
– FY14: $4.1 billionSalesforce Profit Margin: Estimated 34% for FY26 (guidance)
– FY25: 33%
– FY24: 30.5%
– FY23: 30%
– FY22: 28%
– FY21: 26%
– FY20: 24%
– FY19: 22%
– FY18: 20%
– FY17: 18%
– FY16: 16%
– FY15: 14%
– FY14: 12%(This report is current as of February 26, 2025)
In the near future, Benioff anticipates stronger expansion for our company, covering both our product line and services.
Salesforce CEO struggles to establish profit returns in Microsoft’s multi-billion dollar AI investments
As a researcher, I’ve noticed that while Marc Benioff expresses optimism about Salesforce having a successful year, there seems to be a hint of apprehension regarding the significant investments in the AI sphere by corporations such as Microsoft. The question arises whether these substantial wagers will indeed yield substantial returns and profits, as reported by Business Insider.
The CEO of Salesforce made it clear that the company was not allocating resources towards expensive AI initiatives without a guaranteed return on investment.
Instead of constructing massive data centers worth millions to billions of dollars, we are opting for a different approach. We’re avoiding projects that require extensive engineering work, which might yield significant returns but would also deplete our funds and profit margins for an extended period.
In the earnings discussion, the CEO emphasized that the firm is adopting a fresh approach to business and intends to continue utilizing its current technology infrastructure, while enhancing its offerings through Artificial Intelligence (AI).
Benioff suggested that Salesforce intends to leverage other companies’ infrastructure investments to drive the “digital workforce transformation.
The executive’s views arrive at a pivotal moment, as companies such as Amazon and Microsoft appear to be intensifying their focus on artificial intelligence (AI).
Just last month, OpenAI revealed plans for Stargate, an ambitious project worth half a trillion dollars, aimed at building data centers nationwide in the U.S., with the goal of bolstering its artificial intelligence developments.
In simpler terms, Satya Nadella, CEO of Microsoft, mentioned that they reserve around $80 billion every year towards their advancements in Artificial Intelligence (AI). This statement was made to address the ongoing debate about their collaboration with OpenAI post the Stargate project announcement.
Contrarily, Amazon has recently earmarked a massive $100 billion for its capital investments, which has culminated in the unveiling of Alexa+ – an enhanced version of their current generative AI assistant.
Or, In other news, following a significant investment of $100 billion into capital projects, Amazon has now introduced Alexa+, an upgraded version of its existing generative AI assistant.
In his usual direct manner, Benioff didn’t mince words. He explicitly criticized Microsoft for its AI initiatives, labeling it as merely a reseller of OpenAI. His skepticism extends to Microsoft’s AI-enhanced productivity tools, questioning their practicality and effectiveness.
According to Benioff:
1. “In what specific areas of their organization do they deploy their agents? What parts of the company showcase where this has been done effectively? Where do they excel in best practices? Do they combine human and artificial intelligence resources to achieve customer satisfaction? Are they making strategic adjustments by readjusting their workforce with humans and AI agents?”
2. “Where within their business are they stationing their agents? What areas of the company demonstrate where they’ve shown proficiency in this practice? Where do they stand out in terms of best practices? Do they employ a team approach that integrates human and artificial intelligence to drive customer success? Are they optimizing their workforce by balancing human and AI resources?”
3. “Which sections of their organization house their agents? In what parts of the company can we find examples of them executing well? Where do they excel in implementing best practices? Do they collaborate using a hybrid approach that involves humans and artificial intelligence to ensure customer success? Are they optimizing their workforce by adjusting the mix between human and AI resources?”
4. “What departments within their company are utilizing agents? Which sections of the business serve as examples of where they’ve demonstrated skill in this area? Where do they excel at best practices? Do they use a synergistic approach that includes both humans and artificial intelligence to drive customer success? Are they optimizing their workforce by readjusting the balance between human and AI agents?”
Each of these options aims to convey the same core information, but with slightly different wordings for variety and ease of reading.
On more than one occasion, Salesforce CEO Marc Benioff has put Microsoft under scrutiny due to their AI endeavors. In fact, last year, he labeled Copilot as a modern-day Microsoft Clippy, implying that it lacks significant value.
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2025-02-28 18:40