Salesforce sees annual revenue below estimates on weak cloud demand

economictimes.indiatimes.com:

Salesforce expanded its stock buyback program by $10 billion and announced a new dividend, but its annual revenue forecast that was below estimates pushed its shares down around 2% in after hours trading.

The company's downbeat forecast signals a likely slowdown in cloud and tech spending as clients grapple with high interest rates and rising inflation, compelling them to keep a lid on costs.

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The company sees revenue between $37.7 billion to $38 billion for full-year 2025, compared with analysts' estimate of $38.62 billion, according to LSEG data.

Warnings of a slow economy prompted Salesforce to cut about 700 employees, or roughly 1% of its global workforce, last month, adding to the slew of layoffs across the tech and media industry.

«Salesforce is guiding for only 8-9% growth (for the full year), which moves it out of the high growth category. In order to make up for that, it is introducing a dividend, which is appropriate for the lower level of growth,» said Gil Luria, analyst at D.A. Davidson.

Cloud data analytics Snowflake also forecast first-quarter revenue below estimates adding to the woes of cloud firms as they face uncertainty this year.
However, Salesforce beat revenue estimates for fourth-quarter revenue