On Wednesday, Salesforce(NYSE: CRM) turned in solid results for its fiscal 2025 fourth quarter and issued conservative guidance as it looks toward agentic artificial intelligence (AI) to be its next big growth driver. With agentic AI, software bots (the "agents") can autonomously go out and complete tasks on your behalf with little human intervention. That developing technology is viewed as being the next big evolutionary stage of the AI revolution.
However, Salesforce stock has gotten off to a tough start to the year. It's down about 10% in 2025 as of this writing, and nearly flat over the past 12 months.
So what do the software-as-as-service (SaaS) company's most recent results suggest about the possibility that the stock can rebound?
Agentic AI
Salesforce is plowing forward with agentic AI through its Agentforce offering, which it introduced back in October. The AI agent solution has seen quick uptake among customers, with the company saying it had closed 5,000 Agentforce deals, including 3,000 paid deals, as of the end of the fiscal quarter on Jan. 31. That was up from the 1,000 deals the company boasted about in a mid-December update.
Through Agentforce, Salesforce provides its customers with a variety of out-of-the-box AI agents that can handle specific tasks in such areas as customer service, human resources, and technical support. Customers can also use low-code and no-code tools within the platform to create and customize their own AI agents. The company has said if you can describe a task, Agentforce can build an agent to handle it.
Salesforce created Agentforce to help augment the human labor force and increase workers' productivity and efficiency. It's a consumption-based product that costs $2 per interaction.
The company is also leaning into its partnership network. Management says half of its Agentforce sales and 70% of Agentforce activations have come from its partner ecosystem. It noted that it has 127,000 system-integrated employees trained on Agentforce and more than 1,000 technology partners building and selling agents. It noted that customers can now use Agentforce with Alphabet's Gemini, and its multimodal models and be deployed on Google Cloud. It also noted that Amazon has helped it close a number of large deals.
Image source: Getty Images.
As for the fiscal quarter itself, Salesforce's revenue increased by 8% year over year to $10 billion, which was right at the midpoint of its guidance range of $9.9 billion to $10.1 billion. Subscription and support revenue also rose by 8% to $9.45 billion.
Mulesoft revenue jumped 7%, while Slack revenue climbed by 11%. That was an acceleration in growth for both compared to fiscal Q3. Tableau revenue, meanwhile, edged up by 3%.
Adjusted earnings per share (EPS) climbed 21% to $2.78. The company also generated $3.8 billion in free cash flow during the quarter.
Salesforce's current remaining performance obligations (cRPOs) increased by 10% year over year to $30.2 billion. This is a common metric used by SaaS companies to describe their revenue outlooks.
Salesforce forecast that in fiscal 2026, its revenue would grow by 7% to 8%, to a range of $40.5 billion to $40.9 billion, with adjusted EPS of between $11.09 to $11.17. Management also expects subscription and support revenue to grow by about 8.5%. For the fiscal first quarter, it projected that its revenue would grow by between 6% to 7% year over year.
Metric
Fiscal 2026 Q1 Guidance
Fiscal 2026 Guidance
Revenue
$9.71 billion to $9.76 billion
$40.5 billion to $40.9 billion
Revenue growth
6% to 7%
7% to 8%
Adjusted EPS
$2.53 to $2.55
$11.09 to $11.17
Data source: Salesforce.
Can Salesforce's stock rebound?
Salesforce trades at a forward price-to-sales multiple of under 7 based on analysts' estimates for its fiscal 2026, while its forward price-to-earnings (P/E) ratio is under 27, and its price/earnings-to-growth (PEG) ratio is 0.5. A positive PEG ratio below 1 is typically considered to reflect an undervalued stock.
That's an attractive valuation if the Agentforce platform can help accelerate the company's revenue growth. As a consumption platform meant to drive cost savings and improve productivity for its users, the opportunity for the product is enormous. Meanwhile, Salesforce's guidance looks conservative; the company has a good chance of beating and raising it throughout the year. That sets the stock up well for the rest of the year.
I would jump on this leading AI SaaS name, given its valuation and the opportunity it has in front of it.
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John Mackey, former CEO of Whole Foods Market, an Amazon subsidiary, is a member of The Motley Fool's board of directors. Suzanne Frey, an executive at Alphabet, is a member of The Motley Fool's board of directors. Geoffrey Seiler has positions in Alphabet and Salesforce. The Motley Fool has positions in and recommends Alphabet, Amazon, and Salesforce. The Motley Fool has a disclosure policy.
