Salesforce stock surges 12%: did earnings just kill ‘SaaSpocalypse’ fears?

Salesforce shares jumped about 12% in premarket trading on Thursday after the company raised its annual revenue and profit forecasts and expanded its partnership with Anthropic through a new artificial intelligence integration.

The move comes as Salesforce and other software companies have faced heavy pressure from investors concerned that increasingly capable AI models could undermine traditional software businesses.

The companies are launching Claudeforce, a plug-in that brings Salesforce capabilities into Anthropic’s Claude AI models.

The integration initially includes 37 pre-built sales skills, allowing Claude users to compose emails, update records and perform other actions within Salesforce.

Salesforce said the companies intend to expand the integration across Claude, Salesforce and its Slack messaging platform.

“It’s really a first in the industry,” Salesforce CEO Marc Benioff told CNBC’s Jim Cramer on Wednesday.

“It’s completely exciting. I think that this is the way all enterprise systems are going to run in the future.”

The partnership could provide Salesforce with an important way to demonstrate that AI is more complementary to its software than destructive to it.

Revenue forecast gets a boost

Salesforce now expects fiscal 2027 revenue of between $46.1 billion and $46.4 billion, up from its previous forecast of $45.9 billion to $46.2 billion.

The company said the higher outlook reflects continued momentum in Agentforce, Data 360 and Slack, which is helping offset volatility in its overall license revenue.

Chief financial and operating officer Robin Washington also said the forecast incorporates expected contributions from Salesforce’s planned acquisitions of Contentful and Fin, which were announced in June and are expected to close in the coming weeks.

For the fiscal third quarter, Salesforce expects revenue of between $11.42 billion and $11.5 billion, above the $11.415 billion expected by analysts polled by FactSet.

The company also raised its full-year adjusted earnings-per-share forecast to between $16.67 and $16.71, from its previous range of $14.06 to $14.12.

The stronger earnings outlook partly reflects a lower share count following buybacks, alongside improved operational performance.

Salesforce reported quarterly revenue of $11.35 billion, up 11% from a year earlier.

AI becomes a selling point rather than a threat

Salesforce's latest results are particularly significant because the company has been caught in the broader selloff in software stocks.

Salesforce shares were down about 20% this year before Thursday's premarket jump.

The stock, however, has already gained more than 30% from its late-July low as investors began reassessing concerns that AI could fundamentally disrupt traditional software companies.

Benioff used the latest results to push back against what he called the “SaaSpocalypse” narrative.

“This SaaSpocalypse narrative has been such nonsense,” Benioff told Cramer on CNBC’s “Mad Money.”

“Frontier models depend on CRM. They don’t replace it.”

He pointed to Salesforce’s adoption among AI companies as evidence that frontier AI developers are becoming customers of enterprise software rather than replacing it.

According to Benioff, nine of the 10 leading artificial intelligence companies use Salesforce and Slack, with spending on the platforms increasing 435% from a year earlier.

“AI is amplifying the value of our entire platform,” Washington told MarketWatch.

Salesforce said it has delivered more than 7 billion agentic work units across Agentforce and Slack, including 3.2 billion during the second quarter.

The company uses the metric to measure work completed by its AI agents.

Washington said increasing usage of these AI capabilities is complementing growth in the company's traditional software seats.

Strong pipeline adds to investor optimism

Beyond current revenue, Salesforce's pipeline of future business provided another positive signal.

Current remaining performance obligations, or cRPO, reached $33.5 billion, representing 14% growth from a year earlier and slightly exceeding Wall Street's $33.4 billion estimate, according to Evercore ISI analyst Kirk Materne.

Materne highlighted the figure as an encouraging sign for Salesforce, particularly as the company has been promising a reacceleration in organic revenue growth during the second half of the calendar year.

Jefferies trading-desk analyst Jeffrey Favuzza also pointed to the acceleration in cRPO as one of the report's “biggest highlights” after two quarters of 13% growth.

Washington said net new annual order value reached its strongest growth in four years, helping keep Salesforce on track with its expectations.

Rebecca Wettemann, CEO of industry analyst firm Valoir, said the company's performance was being supported by both large contracts and the wider availability of easier-to-deploy AI agents.

"Some big deals announced in the last quarter are driving the numbers, but so is greater availability of more prepackaged, easier-to-deploy AI agents," Wettemann said.

Are SaaSpocalypse fears done with?

Salesforce's rebound could offer some relief to an industry that has spent much of the year confronting questions over AI's impact on established software companies.

The company's stock remains well below its previous levels despite its recent recovery, but the latest results provide investors with evidence that AI adoption can potentially create additional demand for its platform.

The Claudeforce launch is particularly important because it turns a company that could be viewed as an AI competitor into a partner whose technology can drive Salesforce usage.

"The original SaaSpocalpyse thesis of “death,” or at least massive disruption, was how bears were thinking in the early part of the year, but that bearish thesis has now morphed into a less drastic, but still incorrect, theme of how software companies will have to pay more for customer acquisition moving forward with far less pricing power, compressing margins and hindering profitability," a commentary in Fortune, read.

"Just as the classic 1979 Francis Ford Coppola film Apocalypse Now was based on a fictional delirium, so, perhaps is the SaasSpocalyse now," it said.

There is little doubt that autonomous AI agents will intensify competitive pressure across the technology sector, potentially putting a wide range of established software companies at risk.

However, the broad investor retreat from software stocks may also have swept up companies that stand to benefit significantly from the AI transition.

The commentary argued that Salesforce, Booking Holdings and IBM are three examples of software companies that could emerge as long-term AI winners rather than casualties.

Instead of eroding their profitability and pricing power, AI could strengthen both by creating new sources of demand and allowing these companies to capture greater value from their platforms.