In September Salesforce CEO Marc Benioff told Wealth that his company was doing a “hard pivot” to its new AI agent platform Agentforce. Thousands of customers would attend workshops at the business software maker’s annual conference to learn how to use technology that allows users to quickly build AI-powered agents that can make decisions and act on information, including automating customer service tasks. And he set a goal that by January 2025, tens of thousands of customers would be using the product in their business.
That may seem like a tall order, but at least for now, Salesforce investors believe. After the company released its quarterly earnings yesterday (which included 80 mentions of Agentforce during a call with Wall Street analysts), its stock climbed 11% to a record high.
The company’s fiscal third quarter revenue rose 8% year-over-year to $9.44 billion. Its net income was $1.5 billion, up 25% from $1.2 billion a year ago.
Investor enthusiasm will last only so long, however, and Wall Street will want proof that Salesforce’s big spending on its AI efforts — the company did not disclose a specific total — will pay off in the long run. This means that Salesforce has to work hard to actually sell Agentforce to meet its goals.
It’s a critical test for the company as it tries to compete in what has become the most important market for AI products. Every major software company, from Big Tech giants like Microsoft and Google big players like SAP and ServiceNowrushing to cash in on what is expected to be a big future payout.
On a call with analysts, Benioff said Salesforce has already “delivered 200 jobs” on Agentforce, which became generally available on Oct. 24, adding that “our pipeline is incredible for future transactions.” He also confirmed that the company is hiring another 1,000 to 2,000 salespeople to help spread the Agentforce gospel. “Not only have we maximized our productivity of our current Salesforce over the last few years, we just need to grow and expand to reflect this incredible distribution opportunity,” he said.
But how Agentforce will fare with customers remains to be seen. Salesforce is optimistic about demand for the product, but Benioff acknowledged that Agentforce did not “materially contribute” to so-called cRPO in the quarter just ended. The metric is a key indicator of customer acceptance, reflecting future revenue under the contract that has yet to be recognized. Agentforce’s under-impact is not expected to change in the current quarter. That’s because the technology still dwarfs Salesforce’s other products, which generate $37 billion in annual revenue. “We’re still at the very beginning of this journey,” Benioff said.
Still, Benioff was already announcing the next phase of the journey on Tuesday’s earnings call, with the planned launch of what he called Agentforce 2.0 on Dec. 17. All those new sellers will likely be out, well, out in force.
