Salesforce predicts lower growth as CEO focuses on AI’s problems

Salesforce, , , , , ,

CEO Marc Benioff kicked off the earnings call by talking a little about Salesforce’s success and a lot about the problems with AI.


on February 29, 2024

In its Q4 2023 earnings call, Salesforce (March 22, 2024) reported $ 1.45 billion in profits and $ 9.29 billion in revenue for the last quarter of 2023. Its profit of $ 1.47 a share is a huge turnaround from a year ago when it had a loss of $ 98 million, or 10 cents a share, for the same period. The increases were driven by huge growth in its data cloud segment.


The company said around a quarter of its deals worth more than $ 1 million included data cloud. Data cloud deals grew 90% year-over-year, approaching $ 400 billion, prompting Benioff to exclaim during the earnings call, “Fiscal year ’25 needs to be one thing — the ‘Year of Data Cloud!’” He described Data Cloud as “the fastest growing organic product in the history of Salesforce.”


President and COO Brian Millham said the improved sales are “an indicator of the demand that we’re seeing for people to get ready for the AI transformation.” However, the company doesn’t expect AI itself will impact its earnings in the near term. 


Benioff goes boom


This could explain why Benioff kicked off the call with a half hour of forceful discussion that mostly focused on the problems with AI and its creators. He spoke about “stolen data” and The New York Times’ copyright infringement lawsuit against OpenAI, but did not seem to take a stand for or against either side.


Benioff also warned about the fiscal dangers posed by AI. His example was a recent case in which a Canada Air customer won a settlement because a company chatbot made up a non-existent low ticket price.


“These models don’t know anything about the company’s customer relationships, and in some cases are just making it up,” he said. FYI, two days prior Salesforce announced the public beta release of Einstein Copilot, its AI-powered chatbot assistant.


Later, CFO Amy Weaver said Salesforce is “not factoring in material contribution from these products into our FY 25 revenue guidance at this time.” The customer relationship management company expects single-digit revenue growth for the 2025 fiscal year.


 


The post Salesforce predicts lower growth as CEO focuses on AI’s problems appeared first on MarTech.

MarTech

About the author






 

Staff





Constantine von Hoffman is managing editor of MarTech. A veteran journalist, Con has covered business, finance, marketing and tech for CBSNews.com, Brandweek, CMO, and Inc. He has been city editor of the Boston Herald, news producer at NPR, and has written for Harvard Business Review, Boston Magazine, Sierra, and many other publications. He has also been a professional stand-up comedian, given talks at anime and gaming conventions on everything from My Neighbor Totoro to the history of dice and boardgames, and is author of the magical realist novel John Henry the Revelator. He lives in Boston with his wife, Jennifer, and either too many or too few dogs.

(3)

You may also Like