Salesforce's beat fails to convince the market that software can survive AI

Salesforce on Wednesday evening delivered better-than-expected quarterly results, but it wasn't enough to convince the market that AI will help — not hurt — its enterprise software business. Revenue in the quarter ended April 30 rose 13.3% year over year to $11.13 billion, topping expectations of $11.05 billion, according to LSEG. Adjusted earnings per share totaled $3.87, beating the consensus estimate by 76 cents, LSEG data showed. On a year-over-year basis, adjusted EPS increased 50%. CRM 1Y mountain Salesforce 1-year return Shares of Salesforce dipped 1% in the after-hours session to about $176. Shares are down about 33% year to date and about $12 above its 52-week low close of $164.96. Bottom line Salesforce is doing everything it can to signal to the market that this year's sell-off is unwarranted and shares trading at less than 14 times earnings don't appropriately reflect the long-term value of the business. But investors remain hesitant to step in until the company delivers more meaningful revenue acceleration alongside expanding margins. Offering some hope, management reiterated its expectations that revenue growth will reaccelerate in the second half of this fiscal year. The better-than-expected quarterly result, along with the promise of building momentum in the near future, might explain why the after-hours move isn't as wicked as that of some other software stocks in this earnings cycle. …