Ricardo Pillai
3 min read
In This Article:
We came across a bullish thesis on Salesforce, Inc. (CRM) on Compounding Your Wealth’s Substack. In this article, we will summarize the bulls’ thesis on CRM. Salesforce, Inc. (CRM)'s share was trading at $265.37 as of 30th May. CRM’s trailing and forward P/E were 41.53 and 23.47 respectively according to Yahoo Finance.
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Salesforce delivered solid Q1 FY2026 results, posting $9.83 billion in revenue, up 11% year-over-year, with subscription and support revenue growing 12% in constant currency. Remaining performance obligations (RPO) reached $60.9 billion, up 13%, reflecting strong demand visibility. Operating cash flow rose 4% to $6.5 billion. Salesforce reaffirmed its full-year guidance, including a 34% non-GAAP operating margin and 9–10% free cash flow growth.
Sales Cloud drove 80% of large enterprise deals, with strength in verticals like financial services, healthcare, and retail. Account executive headcount is set to expand by 22% this year. Internationally, growth was robust in Canada, the UK, France, and South Asia, while Japan showed signs of acceleration.
The company’s AI initiatives are scaling rapidly—AgentForce, a generative AI product, now has over 4,000 paying customers and was featured in 800+ customer deployments, with potential to reach $1 billion in annualized revenue. Data Cloud surpassed $1 billion in ARR and is processing 22 trillion records, up 175% year-over-year. Tableau, MuleSoft, and Slack were also prominent in major deals, as customers increasingly adopt cross-cloud solutions. Salesforce highlighted Slack’s evolution into an enterprise AI interface, improving lead routing times dramatically from 20 minutes to 19 seconds.
The recent Informatica acquisition aims to enhance data harmonization and accelerate AI capabilities. Salesforce introduced Flex Credits, a usage-based pricing model reflecting early-stage but growing AI consumption.
Notable customer wins included PepsiCo, OpenTable, and Takeda. The company raised its FY26 revenue outlook to $41.3 billion, underscoring its transformation toward data, AI, and unified platform-driven growth.
Previously, we have covered Salesforce, Inc. (CRM) in April 2025 wherein we summarized a bullish thesis by Quality Equities on Substack. In the article, Salesforce (CRM) was highlighted as a structurally resilient, high-margin software business undervalued due to macroeconomic fears. The article argued that the market was underestimating Salesforce’s long-term free cash flow growth, despite strong fundamentals, improving margins, and rising AI-driven innovation. Since our last coverage, the stock is up 13% as of 30th May.
