Business

Salesforce just beat estimates, one analyst still sees more pain

By Peace Longe TheStreet

Updated June 2, 2026 11:50 AM

Salesforce (CRM) gave investors plenty to cheer in its latest quarter, then handed the doubters something, too.

The software giant cleared its earnings bar with room to spare, kept its artificial intelligence story moving, and watched its stock recover ground after a brutal year.

One Wall Street firm still isn't sold. Its warning hangs over the stock as traders try to decide whether the worst is finally behind Salesforce, or whether this beat only buys time.

That single dissent is the most interesting thing about an otherwise strong report, and it tells ordinary investors exactly which number to watch next.

Salesforce stock beat earnings, but one bear refuses to blink

Salesforce reported its fiscal first-quarter 2027 results on May 27, and the headline numbers were strong.

Adjusted earnings came in at $3.88 a share against the $3.12 Wall Street expected, while revenue rose 13% to $11.13 billion, CNBC reported.

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Then came the catch. Full-year guidance landed just below the most optimistic forecasts, and that was enough for Bank of America to hold its ground.

Analyst Tal Liani reinstated coverage in May with an underperform rating and a $160 price target. That call sits far below the roughly $268 average 12-month target across the Street, 24/7 Wall St noted.

In plain terms, the most bearish analyst covering Salesforce thinks the stock still has further to fall, even after a 33% drop in 2026.

Salesforce CEO Marc Benioff is betting the company's future on Agentforce AI. Hershorn/Getty Images

What Agentforce is, and why the AI fear hangs over CRM

To understand the bear case, you need to understand the product everyone is arguing about.

Agentforce is Salesforce's platform for AI agents, a software that can handle sales and customer-service tasks on its own, without a human clicking through screens.

That sounds like a win, but the worry is about what it does to pricing.

Salesforce makes most of its money charging per user, or "per seat." If AI agents do the work of employees, companies may need fewer seats, which could shrink the revenue base instead of growing it.

Bank of America's full note leans on exactly that risk, arguing the company is shifting from a high-growth platform into a slower, mature cash generator.

CEO Marc Benioff is spending into the shift anyway, committing about $300 million on Anthropic AI tokens in 2026, AOL reported.

The Agentforce numbers that test the bear case

This quarter was the first real scoreboard for that debate, and the results cut both ways.

Agentforce's annual recurring revenue reached $1.2 billion, up 205% from a year earlier, while combined AI and data revenue hit about $3.4 billion, according to Salesforce's investor release.

But more than 50% of those bookings came from existing customers, the company confirmed in its SEC filing. That is the same upsell-versus-new-customer concern Liani flagged.

What the quarter proved, and what it left open

Proved: Agentforce is scaling fast, with ARR up triple digits and premium AI bookings growing nearly 60% year over year.
Unclear: Current remaining performance obligation, the most forward-looking bookings gauge, grew 14%, a step down from the 16% pace late last year.
Still a risk: Heavy reliance on existing customers leaves the question of new-customer growth unanswered.

How Salesforce stock stacks up against the S&P 500

For all the AI excitement, Salesforce has badly trailed the market this year, which is why the report mattered so much.

Salesforce vs. the S&P 500 in 2026:

Salesforce (CRM): Down about 33% year to date, according to CNBC
S&P 500: Up roughly 10% over the same stretch

After the first quarter report, the stock found buyers.

Shares initially dipped about 3% on the soft guidance, Seeking Alpha reported, before rallying alongside a broad software relief move later in the week.

What still has to happen for the Salesforce bulls to win

A strong quarter does not settle this debate, so here is what to watch before assuming the bottom is in.

Management raised its full-year revenue outlook midpoint to about $46 billion and promised faster organic growth in the second half. That reacceleration now has to show up.

Three things would weaken the $160 bear case in the next two quarters:

cRPO growth holding at or above the mid-teens, signaling healthy future bookings.
Agentforce ARR pushing well past $1 billion with more new-logo wins, not just upsells.
Guidance that meets or beats, rather than trailing, the high end again.

Salesforce also has support beneath the stock.

It is returning cash aggressively through a large buyback program, and value investors are circling, with Michael Burry reportedly buying the dip.

The honest read for everyday investors: This beat answered some questions and dodged others.

Salesforce proved Agentforce can grow, but not yet that it can replace lost seat revenue and reignite double-digit growth.

Until the next two quarters confirm that second-half acceleration, both the bull case toward $268 and Bank of America's $160 floor remain firmly on the table, making patience, not conviction, the smarter posture here.

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This story was originally published June 2, 2026 at 11:33 AM.