Salesforce has long been the poster child for enterprise software, a company that reshaped how businesses manage customers and sales. But in 2025, that image is under intense strain. As artificial intelligence transforms the technology landscape, Salesforce is caught in a storm of investor skepticism and industry disruption.
The Shadow of the Giants
Unlike Microsoft and Oracle, which both run massive cloud infrastructure businesses, Salesforce remains fully dependent on selling its cloud-based software services. That business model now faces existential questions in the age of AI. If generative AI can write functional code on command, why pay billions for packaged enterprise software? This unsettling possibility has cast a long shadow over Salesforce’s future.
The financial markets reflect this anxiety. Shares of Salesforce are down about 25% this year, the worst performance of any tech company valued at over $100 billion. Cloud software stocks more broadly are reeling, but Salesforce’s size makes it the bellwether. As KeyBanc’s Jackson Ader put it, Salesforce’s stock has become “the linear embodiment of the application software sector.”
Cracks Beneath the Surface
Despite the negative sentiment, Salesforce hasn’t stopped growing. In its July-ending quarter, revenue accelerated slightly, reaching nearly $40 billion annually. The company also hit a record adjusted operating margin of 34.3%, topping Wall Street’s expectations.
But the pace of revenue growth—9.8% year over year—remains below the double-digit expansion that was once Salesforce’s hallmark. Forward guidance also disappointed, with projected contracted revenue growth hovering around 9%. For a company aggressively pushing AI-powered offerings, that modest outlook was underwhelming.
Betting on Agentforce
Salesforce is pinning its hopes on Agentforce, its flagship AI platform launched last year. The service lets companies create their own AI agents—chatbots capable of taking actions on behalf of users. Already, Salesforce says it has signed up more than 6,000 paying customers.
The key question is whether Agentforce can materially move the needle. Revenue growth has yet to reflect a significant AI boost, and analysts remain cautious. UBS’s Karl Keirstead noted that investors need “more tangible proof points” before confidence in Salesforce’s return to double-digit growth can be restored.
The Stakes for the Cloud Industry
Salesforce’s trajectory will influence the entire cloud software sector. If it can successfully leverage AI to reaccelerate growth, it will validate the role of software vendors in the new era of AI-driven business. Analysts like Bernstein’s Mark Moerdler believe platform vendors such as Salesforce are well-positioned to deliver and monetize AI functionalities—but patience will be required.
That patience is in short supply in today’s AI-fueled market. Investors are rewarding rapid, visible AI monetization, and Salesforce’s incremental progress risks being overshadowed by bolder moves from competitors.
A Defining Moment
Salesforce now faces a defining moment. It remains a vital enterprise player with an enormous customer base and enviable margins, but it must prove that its AI pivot is more than just marketing. For now, it carries the burden of representing the cloud software sector’s anxieties. Whether it becomes an AI leader or a cautionary tale will depend on how convincingly it can turn Agentforce into a true growth engine.
The clock is ticking—and in the age of AI, waiting may be the hardest part.
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This article should not be interpreted as investment advice. For any investment decisions, consult a reputable financial advisor. The author and publisher are not responsible for any losses incurred by investors or traders based on the information provided.