Salesforce, Inc. (CRM) is set to release its second-quarter results on August 28, 2024, and Needham analyst Scott Berg has expressed cautious optimism about the company’s performance. Following a weak first quarter, Berg anticipates limited upside for Salesforce in the second quarter due to ongoing economic pressures on spending, which are impacting cloud segments across the board.
While Service Cloud, previously a strong performer, has also shown signs of demand softness, Berg highlights the potential of Salesforce’s Data Cloud as a key area of interest. He notes the Data Cloud’s significant traction in deals exceeding $1 million, with 25% of these deals including the Data Cloud in the first quarter. As AI adoption continues to drive interest, the Data Cloud’s momentum could translate into an incremental boost to Salesforce’s results in the second half of the year.
Despite the near-term challenges, Berg maintains a Buy rating on Salesforce stock, with a price target of $345. The stock has gained over 25% in the last 12 months. Investors seeking exposure to Salesforce can consider ETFs such as the iShares Expanded Tech-Software Sector ETF (IGV) and the REX FANG & Innovation Equity Premium Income ETF (FEPI).
As of Monday, CRM shares were up 0.67% at $265.78.
