Salesforce Inc (NYSE:CRM) shares hit a fresh 52-week low Thursday morning as a cluster of big software earnings including Microsoft Corp (NASDAQ:MSFT), SAP SE (NYSE:SAP) and ServiceNow Inc (NYSE:NOW) set a risk-off tone across the sector and reignited concerns about cloud demand, deal momentum and AI payback timelines.
Microsoft showed a slowdown in Azure momentum, while SAP's mixed quarter and ServiceNow's slower-growth outlook added to the cautious read-through, dragging down large-cap enterprise software names like Salesforce that are closely tied to corporate IT budgets and monetization expectations for AI-led products. Here’s what investors need to know.
SAP Revenue Miss And ServiceNow Growth Slowdown Weigh On Salesforce
Enterprise software giant SAP SE (NYSE:SAP) fell Thursday after mixed results that included a revenue miss in U.S. dollars, even as earnings beat estimates, sharpening investor focus on demand quality rather than profitability alone.
More importantly for sentiment, SAP's CFO flagged a sharper-than-expected slowdown in current cloud backlog growth despite reported strength, attributing it to a deal mix shift toward large transformation projects with longer ramp periods and more flexible structures, exactly the kind of dynamic that can delay near-term revenue visibility across enterprise software.
Meanwhile, ServiceNow shares are down sharply despite the company delivering a beat and reiterating healthy subscription growth expectations. ServiceNow however warned 2026 subscription growth will slow to about 19.5%–20% (vs. 20.5% in 2025), hurting sector sentiment during Thursday trading.
What Microsoft's Earnings Revealed About Cloud Demand
The Microsoft report that set the tone wasn't about weak headline performance. It was about the two issues analysts said the market focused on: AI-related capital expenditures ramping faster than expected and Azure cloud growth coming in a touch below lofty expectations.
Microsoft reported quarterly capital spending of $37.5 billion and said revenue from Azure and other cloud services rose 39% year-over-year, but the market response suggested investors wanted clearer proof that soaring AI infrastructure costs are translating into near-term revenue acceleration.
Why That Pressures Salesforce Specifically
Salesforce trades as a high-quality enterprise software bellwether, so any signal of moderating cloud growth can spark fears of slower seat expansion, longer sales cycles and tighter IT budgets.
Microsoft CFO Amy Hood stressed that AI spending is being allocated across the company's AI stack, not just Azure, and highlighted products like Microsoft 365 Copilot and GitHub Copilot.
For Salesforce, that messaging cuts two ways: it reinforces industry-wide uncertainty about AI ROI and underscores intensifying competition as Microsoft pushes AI tools deeper into the enterprise workflow.
How Salesforce’s Bearish Trend Is Unfolding
Salesforce stock is currently trading 13.7% below its 20-day simple moving average (SMA) and 14.7% below its 100-day SMA, reflecting a bearish trend. Shares have decreased by 40.43% over the past 12 months and are positioned closer to their 52-week lows than highs.
The RSI is at 34.46, considered neutral, while the MACD is below its signal line, indicating bearish pressure on the stock. The combination of neutral RSI and bearish MACD suggests mixed momentum.
CRM’s Business Model
Salesforce provides enterprise cloud computing solutions, specializing in customer relationship management (CRM) technology that connects companies with their customers. Its Customer 360 platform integrates customer data across various systems, enhancing sales, service, marketing, and commerce capabilities.
Can Revenue Growth Offset Valuation Concerns?
Investors are looking ahead to the next earnings report on Feb. 25.
- EPS Estimate: $2.69 (Down from $2.78 YoY)
- Revenue Estimate: $11.19 billion (Up from $9.99 billion YoY)
- Valuation: P/E of 30.4x (Indicates premium valuation)
Analyst Consensus & Recent Actions: The stock carries a Buy Rating with an average price target of $325.04. Recent analyst moves include:
- Barclays: Overweight (Raises Target to $338.00) (Jan. 12)
- RBC Capital: Sector Perform (Raises Target to $290.00) (Jan. 5)
- BTIG: Initiated with Buy (Target $335.00) (Dec. 17, 2025)
Valuation Insight: While the stock trades at a premium P/E multiple, the strong consensus and 3% expected earnings decline suggest analysts view this growth as justification for the 53% upside to analyst targets.
CRM Shares Slide Thursday
CRM Price Action: Salesforce shares were down 7.65% at $210.49 at the time of publication on Thursday, according to Benzinga Pro data.
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