Salesforce’s AI-Driven Surge: Can CRM Stock Rebound to $370?

The market’s skepticism toward Salesforce (CRM) took a sharp turn last week as the cloud software giant reported record cash flows, AI-fueled growth, and a bullish institutional investor pivot. Shares rose 5.4% in a single session on April 28—marking the start of a critical test for whether Salesforce can reclaim its position as a tech leader.

The Catalyst: Q4 Earnings Exceed Expectations

Salesforce’s April 28 earnings report revealed a company in transition. Revenue hit $10.0 billion, up 8% year-over-year, while free cash flow soared to $12.4 billion—a 31% increase. But the real story was AI. The Data Cloud and Agentforce initiatives generated $900 million in annual recurring revenue, a 120% surge from 2024. “AI isn’t just a product line—it’s now the engine of Salesforce’s growth,” said Guggenheim analyst Brian Blake, who upgraded the stock to “Neutral” after a year of downgrades.

The numbers resonated with investors: 5,000 Agentforce deals closed since October 2024, including 3,000 paid contracts, and half of the Fortune 100 now use both Data Cloud and AI tools. This momentum has analysts revising forecasts upward. The consensus price target of $371.51 implies a 45% upside from April 28’s $264 close.

The Backstory: Why Salesforce’s AI Matters

Salesforce’s pivot to AI isn’t just about staying competitive—it’s a survival strategy. Rivals like Microsoft (Dynamics 365) and Oracle (CX Cloud) have chipped away at its CRM dominance. But Salesforce’s $12.4 billion in free cash flow gives it the financial flexibility to out-invest peers.

Viking Global Investors, the hedge fund run by Andreas Halvorsen, has bet big: its $405 million stake in Salesforce ranks ninth among its top holdings. “This isn’t a trade—it’s a long-term call on AI reshaping enterprise software,” said a Viking spokesperson.

The company’s AI initiatives are also altering customer relationships. A quarter of Fortune 100 companies now integrate Salesforce’s Data Cloud into their AI models, creating recurring revenue streams. This “data flywheel” effect could offset macroeconomic headwinds: even if enterprise spending slows, AI’s embedded nature ensures sticky customer contracts.

The Risks: Can Salesforce Stay Ahead?

Despite the optimism, challenges loom. Salesforce’s stock remains 28% below its 52-week high, and macroeconomic uncertainty persists. U.S.-China trade tensions, semiconductor shortages, and interest rate volatility could all dampen tech spending.

Competitors are also accelerating. Microsoft’s Copilot integration into Dynamics 365 has drawn praise, while Oracle’s generative AI tools for CX have attracted midmarket firms. Salesforce must prove its AI can deliver measurable ROI—35% of enterprise buyers still view AI as a “hype-driven expense”, per a 2025 Gartner survey.

The Outlook: A Technical and Fundamental Rebound

Technically, Salesforce’s stock shows signs of stabilization. After hitting a 52-week low of $264 in late April, it rebounded to $268.71 by May 2—a 1.3% gain amid volatile markets. Analysts point to a stochastic buy signal and bearish momentum peaking in April as bullish indicators.

Fundamentally, the path to $371 depends on execution. If Salesforce can convert its AI revenue pipeline into $1.5 billion in ARR by 2026 (as internal targets suggest), the stock could re-rate. Meanwhile, its fortress balance sheet—$6.8 billion in cash and a 15% dividend payout ratio—offers a safety net.

Conclusion: CRM’s AI Gamble Is Paying Off—But the Prize Is Still Ahead

Salesforce’s April earnings proved it can grow in a slowing economy, but the real test is sustaining AI’s momentum. With $900 million in AI ARR and institutional investors like Viking doubling down, the stock’s $371 target isn’t a fantasy—it’s a math problem. If Salesforce continues converting Fortune 100 wins into recurring revenue, the $370 barrier could fall by year-end. For now, the question isn’t whether CRM is undervalued—it’s whether the market will finally believe it.