This Tech Stock is Betting Big on AI - And You Should Too

Salesforce (NYSE: CRM) is making an all-in push to dominate the AI era. After losing ground earlier this year, the cloud software giant has just posted a strong earnings beat and announced an $8 billion acquisition that could redefine its position in enterprise AI. Yet the stock remains 20% off its highs, trading at a discount despite bullish analyst targets as high as $404.

The real story here is the company's reinvention. Salesforce’s new Agentforce platform has landed 8,000 customer deals and is already saving millions in operational costs. Now, with its planned takeover of Informatica, the company is making a high-stakes bet to control the full data + AI stack. 

This is a setup for breakout growth, and the market has yet to respond.

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Strategic Positioning: Agentforce and the Informatica Play

Salesforce has long been the face of CRM and enterprise Software as a Service (SaaS). But the narrative has shifted, and in 2025, it’s all about who owns the AI data stack. Enter Agentforce—Salesforce’s agentic AI suite designed to automate workplace tasks with minimal human input. It has already clocked 8,000 customer deals and a $100M average order value.

Still, skeptics have questioned whether Salesforce had the underlying data infrastructure to back its AI ambitions. CEO Marc Benioff answered decisively this month, announcing an $8 billion all-cash acquisition of Informatica (NYSE: INFA), a leader in enterprise cloud data management.

Wedbush tech analyst Dan Ives called Informatica “a gold mine of data.” If the deal closes, Salesforce gains not just a customer base and valuable IP, but a deeper data layer to supercharge its Agentforce platform.

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Macro & Market Momentum: Riding the AI Wave Late, But Still Riding

While Microsoft, Meta, and others have sprinted ahead in the AI arms race, Salesforce is now positioning itself to catch up—and potentially leapfrog—in the agentic AI era. The company is investing heavily, not just in product development but in workforce reallocation. Its internal AI-led automation has enabled it to redeploy 500 support staff to higher-value roles, resulting in an annual savings of $50 million.

With a $500 million AI venture fund already in place and $1 billion committed to AI development over 18 months, Salesforce is betting the house on its AI roadmap. In a sector where data is king and AI is the warhorse, Salesforce is finally lining up both.

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Financial Outlook & Valuation

Q1 revenue hit $9.8B, up 8% YoY, with operating margins of 32.3%. While short of the 32.6% expected, margins are historically soft in Q1 and forecasted to expand to 34% by year-end. Importantly, Salesforce reaffirmed guidance rather than cutting, showing discipline amid uncertainty.

Analyst sentiment remains bullish, with targets ranging from $350 to $404. At a current P/E in the mid-30s and with expected low-teens FCF growth, CRM appears undervalued versus peers. Free cash flow remains strong, and Salesforce is expected to expand its salesforce (the human kind) by 22% to capture new enterprise demand.

Bear Case

• AI adoption remains early stage; Agentforce is still “a show-me story,” as Citi analysts put it.
• Integration of Informatica could distract leadership and delay core growth.
• Margin expansion may be offset by high international expenses.
• High M&A count (70+ deals since 2006) invites concerns about focus and execution.

Outlook and Price Target

Salesforce now combines a powerful AI interface (Agentforce), a massive new data layer (via Informatica), and a strong SaaS base. With 77% gross margins, recurring revenue, and a global enterprise footprint, it is well-positioned to thrive in the future of Agentic AI. Analyst consensus centers around $360–$404, pointing to a 35–50% upside from current levels.

Conclusion: The Comeback of a Cloud Giant?

Salesforce has endured a tough few months, but the storm clouds are clearing. The market may not be giving the company full credit yet for its aggressive pivot into AI, but its recent moves suggest a deliberate and well-capitalized plan to regain its edge. Between Agentforce traction and the Informatica acquisition, Salesforce is making a bet worth watching—and owning.