Salesforce Inc. (NYSE:CRM) shares dipped in after-hours trading on Wednesday despite a massive first-quarter earnings beat, as soft guidance and legacy weakness overshadowed an explosive under-the-hood surge in enterprise artificial intelligence (AI) adoption.
Dismissing The ‘SaaSpocalypse’
While the weaker performance of the software-as-a-service (SaaS) sector has been in focus on Wall Street, Salesforce Chair and CEO Marc Benioff remained firmly defiant during the company's fiscal first-quarter earnings call.
Addressing prevailing market fears head-on, Benioff pushed back against the pessimistic industry narrative. “Well, you've heard the narrative on the SaaSpocalypse,” Benioff remarked, acknowledging the “crazy thing that these AI apps are transforming software.”
He instead highlighted Salesforce’s massive shift toward autonomous AI as definitive proof of structural resilience.
However, not everyone on Wall Street is fully convinced by the AI pivot just yet. As Chief Analyst Patrick Moorhead at Moor Insights Strategy pointed out on X, investors remain skeptical because Agentforce still represents less than 5% of total sales, ultimately overshadowing the product’s explosive 205% ARR growth to $1.2 billion.
Tableau Masking The AI Boom
The primary culprit behind Salesforce's muted short-term revenue outlook was a temporary drag from legacy segments. Chief Operating and Financial Officer Robin Washington noted that quarterly performance metrics were “partially offset by softness in Commerce Cloud and in Tableau.”
However, this masked an expansion in core next-generation tech. Washington revealed that bookings for Salesforce’s premium SKUs anchored in its new autonomous “Agentforce” capabilities—”grew nearly 60% year-over-year.”
Additionally, Agentforce’s annualized recurring revenue (ARR) officially crossed the milestone $1 billion threshold during the quarter.
Buybacks And H2 Acceleration
Financially, Salesforce comfortably outpaced analyst expectations, posting an adjusted EPS of $3.88 against forecasted estimates of $3.12, alongside record revenue of $11.13 billion.
To defend CRM stock and enhance shareholder value during this transitional period, the enterprise giant deployed its largest ever $25 billion accelerated share repurchase program, effectively reducing its diluted share count by 10% year-over-year.
Management remains highly confident that this internal operational excellence and booming AI pipeline will successfully fuel a strong organic revenue re-acceleration in the second half of fiscal 2027.
How Has CRM Performed In 2026?
In comparison with the S&P 500’s 9.65% year-to-date advance, shares of CRM have declined by 32.99% over the same period. It was down 1.89% in overnight trading.
Over the last month, CRM stock was down 1.48%, and it fell 22.20% and 35.96% over the last six months and the year, respectively. Benzinga’s Edge Stock Rankings indicate that CRM maintains a weak price trend in the long term but a strong trend in the medium and short terms.
Disclaimer: This content was partially produced with the help of AI tools and was reviewed and published by Benzinga editors.
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