On Thursday, Baird adjusted its price target on shares of Salesforce.com (NYSE:CRM) to $295 from the previous $355, while keeping an Outperform rating on the stock. This change follows Salesforce's first quarter fiscal year 2025 earnings release, which revealed revenue and calculated remaining performance obligations (cRPO) figures that fell short of expectations.
The company's second quarter fiscal year 2025 guidance also came in below analyst consensus, although the full-year guidance for fiscal year 2025 was largely reaffirmed, with a slight reduction in expected subscription growth.
Salesforce attributed the weaker-than-anticipated performance to a challenging sales environment, particularly noting difficulties encountered in April. Despite limited details provided about its Data Cloud business, Salesforce mentioned that it played a role in 25% of transactions valued over $1 million. The softening cRPO trends have shifted investor focus towards the feasibility of Salesforce's guidance for the full fiscal year.
Baird will be hosting Salesforce at the upcoming Baird Global Consumer, Technology & Services Conference, which is scheduled to take place from June 4 to June 6 in New York City. The firm anticipates that the conference will provide an opportunity for further insights into Salesforce's strategy and performance outlook.
The reduction in Salesforce's price target by Baird comes as investors are recalibrating their expectations for the company's financial performance in light of the recent earnings report and guidance. The maintained Outperform rating indicates that, despite the reduced price target, Baird continues to see potential in Salesforce's stock.
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