San Francisco, May 18, 2026, 07:04 (PDT)
- BofA put Salesforce back at Underperform, saying AI may change the company’s growth model.
- The call comes ahead of Salesforce’s fiscal first-quarter earnings set for May 27.
- Salesforce shares moved up early Monday even with the bearish note out.
Salesforce was restarted at Underperform by BofA Securities, with the analyst setting a $160 target on the stock. BofA said the company is staring down a “structural reset” as AI shifts customer buying and usage. Despite that, shares rose in early Monday trade, gaining $3.36 to $176.87. Seeking Alpha
Salesforce’s upcoming call takes on new weight as the company tries to show investors that Agentforce, the AI agents product, could drive future growth instead of just cutting into its existing seat-based pricing model, which charges by human user. The company reports fiscal Q1 2027 results on May 27 after the bell.
BofA’s Tal Liani said Salesforce is shifting from high growth to more of a cash generator, with expected revenue growth at about 10% a year. That’s well under the 18% to 28% growth rates seen from fiscal 2020 through fiscal 2023.
Liani isn’t worried about Salesforce losing customers. The issue is that AI could mean the platform needs fewer people. Automating things like lead qualification or service cases with AI could cut the number of paid seats, which has been key to Salesforce’s growth model.
Liani said, “Enterprise entrenchment is not a growth strategy,” pointing out around 90% of the Fortune 500 is already on Salesforce. He called Salesforce a “saturated mission-critical system of record,” saying it doesn’t have much incremental growth left to monetize. Investing.com
Salesforce countered with numbers of its own. In February, the company reported Agentforce annual recurring revenue hit $800 million, a jump of 169% from the prior year. Salesforce also posted fiscal 2026 revenue of $41.5 billion, up 10%, and lifted its fiscal 2030 revenue goal to $63 billion, factoring in Informatica.
Marc Benioff, who runs Salesforce as chair and CEO, said in the release that “Agentic AI is a tailwind” for the business. President and CFO Robin Washington said the company sees a stronger outlook to reaccelerate organic revenue growth for the second half of fiscal 2027. Salesforce
Salesforce picked up steam heading into the week. Shares were up 3.54% on Friday, ending the day at $173.51. The S&P 500 fell 1.24% and the Dow lost 1.07% that day, per MarketWatch data.
Competition is tightening. Liani noted ServiceNow is getting into overlapping workflows, Google is pushing on AI orchestration, and Adobe has marketing overlap. These moves could put Salesforce’s growth and pricing at risk.
BofA’s outlook could get tested if Salesforce’s AI products post stronger paid adoption sooner than investors are betting. Back in May, the company said it would change how it reports revenue for fiscal 2027, shifting to two buckets: Agentforce Apps and Data 360, Platform & Other. That’s meant to show how AI and data now run through its whole lineup.
The immediate focus is on AI. Salesforce says AI boosts the platform’s utility. Bank of America warns it could complicate the old growth story. Investors will see more next week, when the new numbers land.
