Salesforce Is Improving Profitability, But Remains Expensive


  • Benioff’s valuable leadership experience gained over the last two decades enables him to prudently steer Salesforce through the potential economic downturn ahead and bounce back stronger.
  • Management is prudently focused on delivering growth while continuing to expand operating margins, but the stock remains expensively valued relative to peers.
  • Intensifying restrictions on data processing, storage and transfer practices could indeed undermine the efficacy of Salesforce’s sales solutions and AI services.
  • Co-CEO’s departure raises the risk of Salesforce running into a similar plight to Disney’s succession mayhem, whereby the company struggles to find a competent successor to the high-achieving predecessor.

Salesforce West Tower displays the company logo

Takako Hatayama-Phillips

Following weak revenue guidance and the departure of co-CEO Bret Taylor, Salesforce (NYSE:CRM) stock has taken a beating. This comes amid a weakening macro backdrop and increasing fears of a recession ahead, which is pressuring enterprise spending and

Salesforce Quarterly Revenue and Operating Margin

Company filings

Salesforce P/E versus industry peers

Source: Seeking Alpha

Disclosure: I/we have a beneficial long position in the shares of SHOP either through stock ownership, options, or other derivatives. 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.

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