Sustainable Growth Advisers, LP - Global Growth Composite on Salesforce, Inc.
Thesis
SGA continues to own Salesforce despite reducing the position to a below-average weight after subdued operating momentum. Weakness in Marketing, Commerce, and Tableau has been partly offset by strength in Sales Cloud, Service Cloud, Slack, Data Cloud, and rapid expansion of Agentforce. Management expects second-half growth to reaccelerate and continues to target long-term double-digit organic growth alongside margin expansion. SGA believes Salesforce's integration into customer workflows, installed base, and broad product portfolio provide a durable competitive position even as agentic AI changes the software landscape.
“Despite concerns around AI-driven competition, we believe Salesforce’s integration into customer business processes, large installed base, and wide product set position it well to compete effectively in the Agentic AI era, supporting low-teens earnings growth over the next three years.”
Key risks
- Continued weakness in Marketing, Commerce, and Tableau
- Slower-than-expected growth reacceleration
- AI-driven competitive disruption