Salesforce likely to report ‘good’ quarter as turnaround continues: Wedbush

Salesforce (NYSE:CRM) is set to report fiscal first-quarter results after the close of trading tomorrow, with Wedbush Securities expecting “good” results and the continuation of its turnaround efforts.

“We believe this will another step in the right direction on the comeback story for Salesforce to further prove to the Street a renaissance of growth is on the doorstep for the CRM stalwart for FY25,” analysts led by Dan Ives wrote in an investor note. “Investors will be closely watching CRM results and commentary from [Marc] Benioff to further gauge the enterprise demand environment for software and overall appetite for the company’s freshly rolled out AI strategic roadmap with the AI Revolution on the doorstep for the tech world.”

Wedbush has an Outperform rating and $325 price target on Salesforce.

Delving deeper, Salesforce likely was able to generate “strong” cross-sell activity during the quarter, especially compared to previous quarters, including Mulesoft. The company is also believed to have made “major strides” in integrating Slack on the back-end in the broader Salesforce suit, which could fuel some “major” collaboration deals.

Salesforce’s cost-cutting measures have slowed down, and the company now looks to be in a “very balanced position of growth and profitability,” especially as it pushes further into artificial intelligence, the analysts added.

“We continue to believe the risk/reward on CRM is compelling at current levels as the growth and margin story play out over the next 12 to 18 months,” the analysts wrote. “The installed base opportunity is still underappreciated by the Street in our opinion as the CRM machine takes hold over the coming quarters in a much more efficient manner. There is clearly still more wood to chop to turn this growth story around but importantly we believe the tide has started to turn with this quarter another step in the right direction.”

A consensus of analysts expect Salesforce to earn $2.37 per share on $9.15B in revenue during the first-quarter.