Salesforce $CRM ( ▼ 1.32% ) is heading into earnings week under a cloud of skepticism after multiple Wall Street firms slashed their price targets, citing concerns that AI-powered workplace tools could chip away at its core software business. The wave of downgrades has amplified fears that traditional enterprise software vendors may face structural threats from autonomous agents and AI copilots.
Shares have already taken a hit, falling sharply this year as investors reassess whether legacy platforms can maintain pricing power in an AI-first world.
A cascade of target cuts
Several major banks made sizable downward revisions. Morgan Stanley reduced its target by nearly 30%, while Jefferies cut its forecast by a third. Barclays, Evercore ISI, and Citigroup also trimmed expectations significantly, signaling broad concern across the analyst community.
The bearish case centers on the idea that AI workforce tools could automate tasks that currently require expensive software subscriptions. If businesses can rely on intelligent agents instead of large enterprise platforms, demand for traditional CRM systems could weaken over time.
AI: existential threat or growth engine?
Not everyone agrees with the pessimistic outlook. Some analysts argue Salesforce remains deeply embedded in corporate workflows and could benefit from AI adoption rather than be displaced by it. Wedbush, for example, recently labeled the company a “core participant” in the AI revolution and described the sector-wide sell-off as overdone.
This debate reflects a broader uncertainty across software markets: whether AI will primarily disrupt incumbents or enhance their products and strengthen their moats.
All eyes on earnings
With results due Wednesday, Salesforce has an opportunity to reset the narrative. Investors will be looking for evidence that AI features are driving new demand, improving productivity for customers, or expanding revenue opportunities rather than cannibalizing existing products.
After a steep year-to-date decline, the stock’s reaction will likely hinge less on past performance and more on management’s vision for surviving and thriving in an era where software itself is becoming autonomous.