Salesforce adds 1.6% as AI rally tests $261 analyst target

Salesforce shares rose 1.6% to $256.00 on Friday, extending a two-day rally after a 22.6% post-earnings surge, the stock's strongest single-day gain in six years. Volume hit 34.4 million shares, roughly 2.3 times the recent average.

"The quarter refutes the bear thesis that AI agents would cannibalize seat-based revenue," Marc Benioff, Salesforce co-founder and CEO, said on the earnings call. "AI isn't replacing Salesforce. It's unlocking more value across all four layers of our platform."

Metric	Actual	Consensus	Beat/Miss
Revenue	$11.35B	$11.32B	+0.3%
Adjusted EPS	$5.90	$3.27	+$2.63
Agentforce + Data 360 ARR	$3.9B	—	+210% YoY

Adjusted earnings of $5.90 per share included a $2.53-per-share gain from strategic investments. Excluding that, core earnings were about $3.37, up roughly 16 percent year over year. Revenue rose 11 percent to $11.35 billion, with Informatica contributing $456 million and more than four percentage points of growth. Subscription and support revenue totaled $10.8 billion.

The two-day rally narrows the gap to the consensus price target of $261.15 among 47 analysts, implying about 2 percent upside. Forecasts range from $160 to $400. Management raised fiscal 2027 revenue guidance to $46.1 billion to $46.4 billion, with adjusted EPS of $16.67 to $16.71 and a 34.3 percent non-GAAP operating margin.

Agentforce and Data 360 annual recurring revenue reached nearly $3.9 billion, up over 210 percent year over year. Clients used 3.2 billion agentic work units in the quarter. Current remaining performance obligations rose 14 percent to $33.5 billion, while total remaining obligations reached $66.3 billion.

The quarterly filing attributes $2.7 billion of the quarter's unrealized investment gains to Salesforce's stake in Anthropic, now valued at about $5.1 billion. The company also announced Claudeforce, a partnership putting Salesforce data and workflows inside Anthropic's Claude chatbot.

Salesforce trades at 23.5 times trailing earnings, below ServiceNow's 89.3 times and Workday's 41.4 times but above Adobe's 16.7 times. The stock sits at roughly 15.3 times the midpoint of its adjusted earnings outlook. GAAP diluted earnings rose to $4.29 from $1.96, aided by an accelerated share repurchase covering 103 million shares.

The next test comes Tuesday, September 1, when Salesforce hosts a webinar on product adoption and momentum, followed by Investor Day on September 16 at Dreamforce. The guidance raise reflects management's expectation that AI demand will translate into sustained subscription revenue, and investors will watch for evidence that Agentforce adoption is converting into contracted revenue.

This article is for informational purposes only and does not constitute investment advice.