Why Salesforce (CRM) Remains a Buy Despite Lowered Price Targets: AI and Cloud Growth Are Still on Track

In an era of economic uncertainty and cautious corporate spending, Salesforce (CRM) stands out as a rare beacon of resilience. The company’s recent financial results and strategic bets in artificial intelligence (AI) and cloud computing underscore its ability to navigate macroeconomic headwinds while maintaining growth momentum. Despite recent analyst price target reductions, the fundamentals remain compelling for investors willing to look beyond short-term volatility.

Cloud and AI: The Twin Engines of Growth

Salesforce’s fiscal 2024 results demonstrated the durability of its cloud business. Revenue hit $34.9 billion, up 11% year-over-year, driven by a 12% increase in subscription and support revenue [1]. The Data Cloud segment, a critical component of its AI strategy, grew by 90% YoY, reflecting surging demand for AI-ready data solutions [4]. This growth is not just a one-off; the company’s FY2026 guidance, raised to $41–$41.3 billion, reflects 8%–9% annualized growth expectations, with subscription and support revenue projected to rise 8.5% [2].

The AI segment, in particular, is accelerating. Salesforce’s Einstein 1 Platform and Agentforce have become linchpins of its innovation strategy. Agentforce, for instance, has closed 8,000 engagements, including 4,000 paid deals, with an impressive 84% resolution rate on automated tasks [4]. Meanwhile, Data Cloud and AI annual recurring revenue surpassed $1 billion, a 120% YoY jump [2]. These metrics highlight Salesforce’s ability to monetize AI at scale, even as enterprises grapple with the long-term ROI of such investments.

Strategic Acquisitions and Operational Efficiency

Salesforce’s recent $8 billion acquisition of Informatica further cements its leadership in data management and AI [3]. While some analysts question the company’s reliance on acquisitions, the deal aligns with a broader industry trend: enterprises are prioritizing data integration and governance to unlock AI’s potential. Informatica’s tools will enhance Salesforce’s ability to process and analyze customer data, a critical differentiator in a competitive CRM market.

Operational efficiency has also been a quiet strength. Salesforce’s non-GAAP operating margin for FY2024 reached 30.5%, demonstrating disciplined cost management [1]. This margin, combined with a robust $63.4 billion in remaining performance obligation [4], provides a buffer against macroeconomic volatility.

Addressing the Skeptics: Lowered Price Targets and Macro Risks

Critics argue that Salesforce’s stock has been dragged down by broader market pessimism and reduced price targets from analysts. However, this overlooks the company’s structural advantages. Even as global CFOs shift from conservative to aggressive AI strategies—only 4% now adopt a cautious stance, down from 70% five years ago [1]—Salesforce is uniquely positioned to benefit. Its AI agents are already handling 30%–50% of internal workloads, from engineering to customer service [3], proving the technology’s value in real-world applications.

Moreover, Salesforce’s guidance for FY2026 assumes a more cautious 7%–8% revenue growth, down from prior estimates, yet the company still expects to outperform peers in cloud and AI adoption [2]. This suggests management is factoring in macro risks while maintaining confidence in its long-term trajectory.

Conclusion: A Buy for the Long Term

Salesforce’s ability to adapt to macroeconomic pressures while accelerating AI and cloud innovation makes it a compelling buy. The company’s strategic acquisitions, operational discipline, and alignment with enterprise AI adoption trends create a durable competitive moat. While short-term price targets may waver, the underlying story of growth and resilience remains intact. For investors with a multi-year horizon, Salesforce offers a rare combination of technological leadership and financial stability in an uncertain world.

**Source:[1] Salesforce Announces Strong Fourth Quarter Fiscal 2024 [https://www.salesforce.com/news/press-releases/2024/02/28/fy24-q4-earnings/][2] Salesforce Q1 FY2026 Results in Full: Revenue and Cash Flow Rise [https://www.salesforceben.com/salesforce-q1-fy26-results-in-full-revenue-and-cash-flow-rise-crm-stock-gets-boost/][3] Salesforce: Q1 Results and Updated Valuation - Summit Stocks [https://summitstocks.substack.com/p/salesforce-q1-results-and-updated][4] Salesforce Q1 FY 2026 Results Show AI Momentum [https://futurumgroup.com/insights/salesforce-q1-fy-2026-results-show-ai-momentum-and-strong-rpo-growth/]