AI is the 'next frontier' for Salesforce, analysts say
Salesforce’s (CRM) newly revamped artificial intelligence offerings are finally beginning to click with customers, according to Wedbush analysts.
Agentforce, the company’s updated suite of AI agents that it unveiled earlier this month, has become twice as accurate, with less hallucinations and faster implementation, the strategists, led by Dan Ives, said in a research note published Thursday.
That is “now resonating well among its core customer base,” Ives said.
Customers have begun to see more use cases for Salesforce’s Customer Relationship Management (CRM) software, which helps businesses build and improve relationships with customers, according to Ives. At the same time the company is “advancing into its next wave of growth and capitalizing on the transformational demand for AI solutions by increasing automation and efficiencies across organizations,” he wrote.
The combined potential of the company’s CRM sales machine and AI opportunity is the company’s “next frontier,” Ives said.
By monetizing AI within Salesforce’s massive CRM base, Ives said the company has a “major land grab opportunity that could significantly benefit CRM over the coming years and could increase overall revenue by $4 billion+ annually” by next year.
The cloud-based software company, which rivals the likes of Microsoft (MSFT) and Oracle (ORCL), launched its first generative AI assistant, then known as Einstein Copilot, back in February. That was significantly behind competitors like OpenAI’s ChatGPT, Google’s (GOOGL) Bard, Microsoft’s Copilot, and Anthropic’s Claude.
It came out with a rebranded version on Sept. 12, with the reveal of its new and improved AI agent, Agentforce. Unlike its rivals, this AI agent is designed exclusively for business clients.
Salesforce has said Agentforce’s AI agents are able to analyze data, make decisions, and take action on a number of tasks, including answering customer service inquiries, converting potential customers into customers, and improving marketing campaigns. Unlike chatbots and copilots, Agentforce operates autonomously and can carry out tasks without human intervention.
Chief executive officer Marc Benioff said in a statement that he expects to have 1 billion agents by the end of 2025.
Ives said Thursday that he believes CRM will be a second-derivative beneficiary of the AI revolution, adding around $40 per share at Salesforce over the next 12 to 18 months.
Shares of Salesforce closed Thursday at $275.76 per share. The company’s stock is up nearly 8% so far this year.
