Salesforce (CRM), a leading provider of customer relationship management (CRM) software, has seen its stock price decline significantly in 2025, making it one of the worst performers in the Dow Jones Industrial Average. This decline is largely attributed to rising investor fears about the impact of artificial intelligence (AI) on the company's future growth prospects.
Why is Salesforce Stock Struggling?
Despite Salesforce's efforts to integrate AI into its suite of tools, investors remain cautious. The company's growth is slowing, and there are concerns that AI-powered solutions from competitors like Microsoft and Oracle could disrupt Salesforce's dominance in the CRM market. The stock has lost nearly 30% of its value in 2025.
Is Salesforce Stock Undervalued?
Despite the pessimism, some analysts believe that Salesforce's stock is now undervalued. The stock currently trades at a lower multiple of estimated earnings compared to its historical average and the broader market. If Salesforce can deliver on its forecast of double-digit revenue growth in the coming years, the current valuation may represent an attractive opportunity for long-term investors.
Traders Expect Volatility After Earnings
Salesforce is scheduled to release its latest quarterly earnings report soon. Options pricing suggests that traders expect the stock to move significantly in either direction following the announcement. Strong results and a positive outlook could help boost investor confidence and drive the stock higher.
Analysts Remain Bullish
Despite the recent struggles, many analysts remain bullish on Salesforce stock. They believe that the company is well-positioned to benefit from the continued growth of the CRM market and that its investments in AI will eventually pay off. The majority of analysts currently rate Salesforce as a "buy".
Conclusion
Salesforce's stock is facing headwinds due to concerns about AI disruption and slowing growth. However, the stock may be undervalued, and a positive earnings report could be a catalyst for a turnaround. Investors should carefully consider the risks and potential rewards before investing in Salesforce stock.