Salesforce: Challenged, But Has Platform Strength And Is Capital-Light


  • Salesforce is facing challenges to growing revenues in the current uncertain economic environment.
  • However, its platform enables customers to develop and scale apps rapidly, while saving on costs as well as streamlining operations to become more efficient.
  • The company is adopting a new sales approach together with cost-saving measures in order to boost profitability.
  • Looking deeper, it is the re-platforming project that should be more beneficial to margins, while its platform investments are also capital-light.
  • Despite all these strengths, I opt for caution and have a neutral position on the stock in view of the current challenges I evoke.

The entrance to Salesforce office building in Dallas, Texas, USA.


Whether it is the S&P 500 or the tech-heavy Nasdaq Composite, Salesforce (NYSE:CRM) has underperformed both by a large margin as seen by the deep blue chart below. However, the company has outperformed both of these indices by at least

Data by YCharts

Key performance indicators

The 25% Cost Savings (

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Disclosure: I/we have no stock, option or similar derivative position in any of the companies mentioned, and no plans to initiate any such positions within the next 72 hours. I wrote this article myself, and it expresses my own opinions. I am not receiving compensation for it (other than from Seeking Alpha). I have no business relationship with any company whose stock is mentioned in this article.

Additional disclosure: This is an investment thesis and is intended for informational purposes. Investors are kindly requested to do additional research before investing.

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