What You Need To Know Ahead of Salesforce's Earnings Report
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Key TakeawaysSalesforce reports fiscal 2025 second-quarter earnings on Wednesday, Aug. 28.Analysts expect the customer relationship management company to report revenue and profit growth from the year-ago period.Investors are expected to be watching for indicators that margins are improving.Salesforce is likely to provide updates about its artificial intelligence projects.
Salesforce (CRM) will release its fiscal 2025 second-quarter results after the bell Wednesday, with investors likely watching for improving operating margins and updates on artificial intelligence (AI) initiatives.Analysts project revenue to grow to $9.24 billion from $8.6 billion a year ago, according to estimates compiled by Visible Alpha. Net income is expected to be $1.34 billion, or $1.36 per share, a rise from the year-ago period but down from the previous quarter.
Analyst Estimates for Q2 2025
Q1 2025
Q2 2024
Revenue
$9.24 billion
$9.13 billion
$8.6 billion
Diluted Earnings Per Share
$1.36
$1.56
$1.28
Net Income
$1.34 billion
$1.53 billion
$1.27 billion
Key Metrics: Margin ImprovementAfter Salesforce's first-quarter results sent shares tumbling, raising concerns about the company's future growth, Deutsche Bank analysts said they expect investors to focus on operating margin, where they see a slight upside.They wrote, "Investor sentiment on Salesforce leans more bearish vs. prior quarters" due to debates around margin potential, medium-term growth trajectory, and AI monetization. The analysts added they are "hard pressed to come away from the quarter changing viewpoints on GenAI monetization and revenue trajectory, though anticipate performance/commentary on margin will likely signal the margin opportunity" for the second half of the fiscal year and fiscal 2026.According to Visible Alpha, analysts expect operating income to be $2.33 billion on $9.24 billion in revenue, which would translate to an operating margin of 25%.Business Spotlight: AI OpportunityDespite concerns about growth, some analysts highlighted Salesforce's potential for AI-related gains.In a note titled "Don't Count Software Out of Gen-AI," Goldman Sachs analysts said that application software incumbents, like Salesforce, have developed Gen-AI products amid the AI boom.The company likely will provide updates on its AI initiatives and customer adoption of its AI platform Einstein 1.Salesforce shares, which were essentially flat on the year through Friday's close, were up roughly 1% at $266.58 as of 11:30 a.m. ET Monday. Read the original article on Investopedia.
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