Zinger Key Points
- Needham's Scott Berg expects limited upside for Salesforce in Q2 due to macroeconomic pressures on spending.
- Data Cloud's performance, especially in $1 million+ deals, is anticipated to be a key focus, potentially boosting results in H2.
- Get Monthly Picks of Market's Fastest Movers
Needham analyst Scott Berg expressed views on Salesforce, Inc. CRM ahead of its second quarter results release on August 28, 2024.
The analyst writes that following a weak first quarter, they expect Salesforce to report limited upside in the second quarter due to ongoing macroeconomic pressures on spending.
The analyst remains cautious as demand softness is noted across most cloud segments, including Service Cloud, which had previously been a strong performer.
Berg expects Salesforce’s Data Cloud to be a focal point in the discussions, especially given its traction in $1 million+ deals, with 25% including Data Cloud in the first quarter.
As AI adoption drives interest, Data Cloud could continue its momentum, potentially providing an incremental boost to results in the second half, adds the analyst.
The analyst maintained a Buy rating on the stock, with a price target of $345.
Salesforce stock gained over 25% in the last 12 months. Investors can gain exposure to the stock via iShares Expanded Tech-Software Sector ETF IGV and REX FANG & Innovation Equity Premium Income ETF FEPI.
Price Action: CRM shares are up 0.67% at $265.78 at the last check Monday.
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Disclaimer: This content was partially produced with the help of AI tools and was reviewed and published by Benzinga editors.
© 2024 Benzinga.com. Benzinga does not provide investment advice. All rights reserved.
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