Salesforce (NYSE: CRM) stock plummeted during intraday trading Thursday after the company reported lower-than-expected first-quarter revenue and provided weak Q2 guidance.
Salesforce posted revenue of $9.13 billion for the fiscal first quarter of 2025, marking an 11% increase from the previous year. However, this figure fell below analysts’ expectations, per estimates compiled by Visible Alpha.
Despite revenue missing the mark, Salesforce showcased robust performance in net income. The company reported a net income of $1.53 billion, or $1.56 per share, compared to $199 million, or 20 cents per share in the same period a year earlier. This beat analysts’ estimates.
Looking ahead, Salesforce projected its second-quarter revenue to range between $9.2 billion and $9.25 billion. However, this forecast fell below analysts’ estimates of $9.35 billion. Despite this, the company maintained its full-year revenue guidance, estimating it to fall between $37.7 billion to $38 billion.
Salesforce CEO Marc Benioff emphasized the company’s strategic position to capitalize on the opportunities presented by the artificial intelligence (AI) era. He described it as “the beginning of a massive opportunity for our customers to connect with their customers in a whole new way with AI.”
Analysts Lowering Price Targets Amid Growth Concerns
However, concerns about slowing growth in a challenging macroeconomic environment led several analysts to lower their price targets for Salesforce stock following the earnings release.
Bank of America analysts cut their price target to $288 from $360, citing a “tough demand environment” impacting Salesforce’s results.
CFRA analysts set a new price target of $300, down from $330. They highlighted that the second-quarter guidance suggests a sales growth deceleration to 7%-8%, the slowest pace in CRM’s history, reflecting continued uncertainty in the buying environment.
Jefferies adjusted its target to $350 from $360, describing the earnings report as “lackluster” and pointing out the volatility and difficult macroeconomic conditions.
Salesforce (NYSE: CRM) Stock Price Action
On Thursday, CRM stock plunged 19.74%, closing at $218.01, marking a 23.19% decrease for the week. The trading volume was 66,860,912 shares, significantly higher than the average daily volume of 6.31 million.
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