CRM - Salesforce's Q4 Earnings Potential Bolstered by Generative AI and Market Optimism Analysts Forecast | Benzinga
Citi analyst Tyler Radke reiterated a Neutral rating on Salesforce, Inc.(NYSE:CRM) and raised the price target from $265 to $325.
As investors head into the company’s fourth-quarter and year-end with balanced views as stabilizing demand signals are offset by lagging seat-based down-sell headwinds limiting reaccelerating growth potential.
Radke’s partner checks were mixed but leaned modestly more positive than last quarter as he heard more greenshoot anecdotes (front office budgets back to growth objectives).
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That said, continued long sale cycles and renewal/down-sell pressures persist, as per the analyst. This leads Radke to boost his estimates modestly for fiscal 2025 (Citi CC revenue rise ~200bps), though still slightly below consensus.
The analyst expects continued margin expansion (Citi estimates +150bps of operating margin expansion) in fiscal 2025, as generative AI investments are offset by continued cost discipline.
Ultimately, he remained Neutral rated as Salesforce may struggle to accelerate revenue growth in fiscal 2025 (vs. the broader software universe) as per the analyst.
Radke projects fourth-quarter revenue and EPS of $9.22 billion (consensus $9.13 billion) and $2.22 ...