Salesforce and CrowdStrike both posted quarterly results Wednesday that beat Wall Street’s expectations by wide margins, sending both stocks sharply higher in after-hours trading as investors weighed how much of the software industry’s AI push is translating into actual earnings growth.
Salesforce Blows Past Estimates
Salesforce reported non-GAAP earnings of $5.90 per share, far ahead of the $3.27 analysts had forecast, on revenue of $11.3 billion, up 11% year-over-year. The company raised its full-year revenue guidance to $46.1 billion to $46.4 billion and lifted its non-GAAP earnings-per-share outlook to $16.67 to $16.71. Executives credited the results in part to growth in Agentforce, the company’s AI agent product line, and its integration of outside AI models including Anthropic’s.
CrowdStrike Lifts Its Forecast
CrowdStrike reported revenue of $1.47 billion, above the $1.44 billion analysts expected, with adjusted earnings of $0.31 per share versus a $0.29 estimate. Sales grew nearly 26% year-over-year, and the company raised its full-year revenue forecast to a range of $5.99 billion to $6.01 billion, citing rising demand for cybersecurity tools as AI-related threats increase. Its shares jumped more than 11% in extended trading following the report.
The Buyback in the Background
Salesforce’s earnings beat comes a few months after the company launched its largest-ever stock buyback, a $25 billion accelerated repurchase funded partly with new debt, part of a $50 billion buyback authorization its board approved earlier this year. That repurchase, along with dividends, pushed Salesforce’s total shareholder returns to $27.5 billion in the prior quarter and cut its diluted share count by about 10% year-over-year, a reduction that mechanically boosts per-share earnings figures like the one reported Wednesday. Salesforce also cut its cash-flow growth guidance roughly in half at the time to account for the debt taken on to fund the buyback.
What It Means
Both companies’ results suggest that at least some large enterprise software vendors are converting AI-driven product growth into real revenue and earnings gains, rather than just AI-branded marketing, though Salesforce’s per-share numbers are flattered by its reduced share count as well as by underlying growth.
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