Salesforce's Agentic AI Push: Can It Reaccelerate CRM's Sales Growth?

Salesforce, Inc. CRM is betting heavily on Agentic AI (artificial intelligence) to re-accelerate revenue growth after a period of moderation. The initiative is already showing positive signs as reflected in its latest quarterly results. In the last reported results for the fourth quarter of fiscal 2026, CRM’s revenues increased 12% year over year, breaking the trend of single-digit top-line growth over the preceding six quarters.

Agentic AI refers to systems that can act on behalf of users by automating tasks, generating insights and helping teams make decisions faster. Salesforce has embedded these capabilities into its products to make workflows more efficient and outcomes more predictable.

The company’s Agentforce suite is a key part of its broader Agentic AI push strategy. Salesforce’s Agentforce platform is gaining solid momentum. Combined with Data Cloud, these AI-driven offerings brought in $2.9 billion in recurring revenues in the fourth quarter of fiscal 2026, representing a 200% year-over-year increase. Agentforce alone generated $800 million in recurring revenues, calling for a 169% year-over-year surge.

Booking trends are encouraging as well. Salesforce ended the fourth quarter of fiscal 2026 with the current remaining performance obligation of $35.1 billion, rising 16% year over year, primarily driven by larger deals and early renewals. Management highlighted that more than 60% of Agentforce deals came from existing clients, showing Salesforce’s success in cross-selling AI features to its user base.

Overall, Agentforce is providing Salesforce with a clearer path to reaccelerate growth. The durability of this shift will depend on sustained adoption and consistent execution across its various cloud segments. Management forecasts that fiscal 2027 revenues will increase in the 10-11% range, while the Zacks Consensus Estimate indicates 10.9% year-over-year growth.

How Competitors Fare Against Salesforce

Microsoft Corporation MSFT and ServiceNow, Inc. NOW are also pushing AI automation in the enterprise market.

Microsoft has integrated strong AI features into its Dynamics 365 platform through its Copilot tools, simplifying tasks such as writing emails, creating reports and summarizing meetings for users. Since many companies already use Microsoft products, integrating Copilot into their existing workflows is simple and cost-effective.

ServiceNow’s Now Assist platform uses AI to automate IT service management, customer support and human resource management tasks. ServiceNow has been rolling out industry-specific AI tools, similar to what Salesforce is doing with Agentforce.

Salesforce’s Price Performance, Valuation and Estimates

Shares of Salesforce have plunged 30.1% over the past year compared with the Zacks Internet – Software industry’s decline of 5.1%.

Salesforce One-Year Price Return Performance

Image Source: Zacks Investment Research

From a valuation standpoint, CRM trades at a forward price-to-earnings ratio of 14.67, significantly below the industry’s average of 27.42.

Salesforce Forward 12-Month Price-To-Earnings Ratio

Image Source: Zacks Investment Research

The Zacks Consensus Estimate for Salesforce’s fiscal 2026 and 2027 earnings implies a year-over-year increase of approximately 4.8% and 11.9%, respectively. Estimates for fiscal 2026 and 2027 have been revised upward in the past 30 days.

Image Source: Zacks Investment Research

Salesforce currently carries a Zacks Rank #3 (Hold). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.

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This article originally published on Zacks Investment Research (zacks.com).

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