Is Salesforce (CRM) a Buy Despite Weak Guidance and AI Challenges?

In the ever-shifting landscape of enterprise software, Salesforce (CRM) remains a bellwether for innovation—and a cautionary tale for execution. The company’s third-quarter fiscal 2025 results, reported on December 3, 2024, showed resilience: revenue hit $9.44 billion, up 8% year-over-year, with a non-GAAP operating margin of 33.1% [2]. Yet, as the company eyes a $37.8 billion to $38.0 billion revenue finish for the year, investors are left to weigh this strength against a litany of AI-related challenges and integration risks. Is Salesforce a buy, or is its stock price—a recent 6% drop despite AI-driven product expansions [6]—a warning sign?

Revenue Resilience: A Foundation Built on Subscription Growth

Salesforce’s subscription and support revenue grew 9% year-over-year in Q3, a testament to its sticky cloud CRM model [2]. The company’s ability to maintain margins—GAAP operating margin at 20.0% and non-GAAP at 33.1%—suggests operational discipline, even as macroeconomic headwinds persist. Analysts project Q3 revenue could reach $10.24 billion to $10.29 billion [4], signaling confidence in its core business.

The recent acquisition of Informatica, valued at $8 billion, is positioned to bolster this resilience. Informatica’s cloud subscription revenue hit $210 million in Q2 2025, a 30% year-over-year jump [1], and its data governance tools are expected to integrate with Salesforce’s Data Cloud and Agentforce platforms. This synergy could unlock new revenue streams by enabling “agentic AI” solutions, where AI agents operate with greater transparency and governance [5].

AI Challenges: Monetization, Integration, and Leadership Risks

Despite these positives, Salesforce’s AI ambitions remain a double-edged sword. Agentforce, its AI agent platform, automated 84% of customer inquiries and cut support headcount from 9,000 to 5,000 [5]. Yet, even with a 120% year-over-year growth in AI-related ARR to $1.2 billion, this segment accounts for less than 3% of total revenue [4]. By comparison, Microsoft’s AI-driven Azure cloud now generates over 10% of its revenue, highlighting a gap in Salesforce’s monetization strategy.

The Informatica acquisition, while strategically sound, introduces execution risks. Informatica’s tools overlap with MuleSoft, another Salesforce subsidiary, raising concerns about platform sprawl and customer confusion [2]. Analysts warn that integration could take years, during which support disruptions and licensing complexities may erode trust [3]. Meanwhile, leadership changes—such as the departure of key executives—add uncertainty to strategic continuity [6].

The Balancing Act: CFOs Bet on AI, but Caution Persists

A Salesforce-commissioned study reveals a shift in corporate sentiment: 70% of CFOs had conservative AI strategies in 2020, but only 4% do so in 2025 [3]. This reflects a broader acceptance of AI as a growth driver, with 61% of CFOs reallocating budgets toward agentic AI. However, 66% of CFOs also cite security and integration risks as major concerns [3], underscoring the tension between innovation and execution.

For Salesforce, this means the path forward hinges on scaling AI’s revenue contribution while mitigating integration costs. If Agentforce and Data Cloud can grow to represent 5–10% of total revenue—a threshold some analysts predict [5]—the company could reinvigorate its growth story. But until then, the stock’s underperformance and mixed Q4 guidance suggest investors are skeptical.

Conclusion: A Buy for the Long Haul, but With Caution

Salesforce’s revenue resilience is undeniable. Its subscription model, strong margins, and strategic acquisitions like Informatica provide a solid foundation. However, the company’s AI challenges—monetization gaps, integration risks, and leadership uncertainty—cannot be ignored.

For investors with a long-term horizon, Salesforce’s AI vision and data-driven ecosystem offer compelling upside. But for those prioritizing near-term stability, the stock’s volatility and weak guidance may warrant caution. In the end, the question isn’t just whether Salesforce is a buy—it’s whether the company can execute its AI ambitions without repeating the integration missteps of its past.

Source:
[1] Informatica Maintains Product Innovation Pace, Reports Revenue Growth Amidst Salesforce Acquisition Process, [https://www.crn.com/news/ai/2025/informatica-maintains-product-innovation-pace-reports-revenue-growth-amidst-salesforce-acquisition-process]
[2] Salesforce Announces Third Quarter Fiscal 2025 Results, [https://www.salesforce.com/news/press-releases/2024/12/03/salesforce-announces-third-quarter-fiscal-2025-results/]
[3] New Study Shows CFOs Going All In on AI, [https://www.salesforce.com/news/stories/cfos-invest-ai-for-growth/]
[4] Salesforce slides despite solid Q2 results as Q3 outlook appears mixed, [https://seekingalpha.com/news/4491973-salesforce-slides-despite-solid-q2-results-as-q3-outlook-appears-mixed]
[5] Salesforce Signs Definitive Agreement to Acquire Informatica, [https://investor.salesforce.com/news/news-details/2025/Salesforce-Signs-Definitive-Agreement-to-Acquire-Informatica/default.aspx]
[6] Salesforce (CRM) Expands AI-Driven Customer, [https://www.webull.com/news/13329922921358336]