TLDR
- Both Bernstein and KeyBanc downgraded Salesforce (CRM) to Sector Weight on Thursday
- Analysts cite weak customer feedback and lack of momentum for the Agentforce AI product
- CRM stock was down more than 4% in premarket trading Thursday, trading around $159
- More CIOs surveyed plan to deprioritize Salesforce in their IT budgets over the next 12 months
- Analyst Jackson Ader said customer data “isn’t organized enough” for meaningful AI work
Salesforce is having a rough Thursday. The stock dropped more than 4% in premarket trading after both Bernstein and KeyBanc Capital Markets cut their ratings on the same day, with both firms pointing to the same problem: Agentforce isn’t delivering.
CRM was trading around $159 in early action, down from a previous close of $166.58.
KeyBanc analyst Jackson Ader downgraded CRM to Sector Weight from Overweight, saying he found “little to no evidence, other than the valuation multiple, that the stock lends itself to a bullish recommendation.” That’s a pretty direct admission that the bull case has run out of road.
Ader noted the timing wasn’t ideal. Salesforce has already dropped 37% this year, and he acknowledged the call is “better late than never.”
The core issue isn’t valuation — it’s the AI product. Ader said that after attending partner and customer events, he came away with the impression that client data simply isn’t in the kind of order needed for serious AI work to happen.
Agentforce, Salesforce’s flagship AI offering, comes in for direct criticism. Ader said the product “just isn’t there,” and that partners are only now starting to move proof-of-concept work into actual pipeline deals.
CIO Survey Flags Budget Concerns
A Bernstein CIO survey added more weight to the concerns. More CIOs said they expect to deprioritize Salesforce within their IT budgets over the next 12 months than those who plan to increase spending. That’s a rare directional signal that’s hard to ignore.
Bernstein also noted that Salesforce was “a standout for the wrong reasons” in the survey — not exactly the kind of attention a company wants when trying to sell an AI transformation story.
The firm said it has struggled to find evidence in financial disclosures that net-new average order value is growing faster than overall AOV growth — a point management has leaned on in its public narrative.
Valuation Doesn’t Tell the Full Story
The valuation picture is more nuanced than it looks. Yes, Salesforce trades at a historically low multiple. The enterprise-value to free-cash-flow multiple sits nearly 80% below its post-2020 peak.
But Ader pushed back on the “cheap stock” argument. When stacked against software peers, CRM trades at or near the median — and above peers on a growth-adjusted basis. So the discount isn’t as deep as the headline number suggests.
Bernstein still views Salesforce as a well-entrenched platform with sticky customers. That hasn’t changed. What has changed is the timeline for any meaningful Agentforce-driven acceleration.
Bernstein said that evidence of sustained acceleration is “further out than we’d expected, if it plays out at all.” That’s a notable shift in tone from a firm that had previously defended Salesforce against the “Death of SaaS” narrative.
Ader summed it up plainly: “Larger or longer acceleration is needed to deliver upside, and that, it seems, will be hard to come by in 2026.”
Salesforce did not respond to media requests for comment ahead of publication.
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