Salesforce Q3 Earnings

By Patrick Moorhead - December 5, 2023

The Six Five team discusses Salesforce Q3 Earnings.

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Patrick Moorhead: Salesforce. Dan, go.

Daniel Newman: All right. Salesforce, up 10%. Big upward guide. Powered by Data Cloud growth, AI at the S Center. Best company outside of Microsoft and NVIDIA in terms of telling a monetizable AI story. Saw that in their Data Cloud growth. Big reason for the rocket ship upwards after its earnings wasn’t the 10 ish percent growth, it was the big upward guidance for the rest of the year. Company’s been able to raise prices, has incredible, incredible elasticity and you just can’t get off the platform. And so they’re making it stickier. They’re adding all kinds of generative AI capabilities. And Pat, this is why I think it was, although we’re not investor or financial analysts and we are industry, this is why I do think it was oversold and this is why I’ve been so bullish on it since Genie is when you need a big CRM implementation and a big kind of customer platform, where else do people go besides Salesforce? It’s been the leader, it stays the leader, it’s just where people are right now. Not to say there aren’t others, but this was a great quarter for the company.

Patrick Moorhead: Yeah. I was impressed with the Data Cloud growth and I haven’t done enough research yet to know if that means that they’re pulling in on-prem data. What it does mean is they’re pulling a lot of new data in and they’re monetizing it. Stocks up 75% in 2023. And my question, Daniel, is when do we think they could get back to the 20% growth days or is 11% growth the new norm? We’re going to have to see. I do think it’s somewhat of a new Salesforce with the cost cuts. Salesforce wasn’t exactly a cost-cutting machine. It was all about that 20% growth or so.

Daniel Newman: I love that you pointed that out by the way. Apex was so important to how they were able to crush bottom line. They rolled their sleeves up, man. They rolled up their sleeves, lost some weight.

Patrick Moorhead: Yeah. They totally did.

Patrick Moorhead
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Patrick founded the firm based on his real-world world technology experiences with the understanding of what he wasn’t getting from analysts and consultants. Ten years later, Patrick is ranked #1 among technology industry analysts in terms of “power” (ARInsights)  in “press citations” (Apollo Research). Moorhead is a contributor at Forbes and frequently appears on CNBC. He is a broad-based analyst covering a wide variety of topics including the cloud, enterprise SaaS, collaboration, client computing, and semiconductors. He has 30 years of experience including 15 years of executive experience at high tech companies (NCR, AT&T, Compaq, now HP, and AMD) leading strategy, product management, product marketing, and corporate marketing, including three industry board appointments.