Is Salesforce (CRM) Stock A Buy In 2025? 3 Key Drivers Behind Its AI and Profitability Push

Salesforce (CRM) kicked off 2025 with better-than-expected earnings and revenue, driven by rising adoption of its AI-powered Agentforce tool and a solid $6.3 billion in free cash flow.

With strategic acquisitions like Informatica and potential interest in Asana, the company is doubling down on AI and data dominance to stay ahead in an increasingly competitive CRM market.

However, with growth slowing to 8–10% annually and rivals like Microsoft, Oracle, and HubSpot gaining ground, is Salesforce still worth the premium price tag? 

In this post, we break down three key drivers shaping the stock’s outlook in 2025 using the Invest Diva Diamond Analysis (IDDA) framework, using Capital, Intentional, Fundamental, Sentimental, and Technical to help you decide if CRM deserves a spot in your long-term portfolio.

IDDA Point 1 & 2: Capital & Intentional

Before investing in Salesforce (CRM), ask yourself:
✅ Are you looking for exposure to one of the world’s largest and most trusted enterprise software platforms, with deep penetration across Fortune 500 companies?
✅ Do you believe in the long-term potential of AI-powered CRM tools, like Agentforce, to drive automation, customer insights, and business productivity?
✅ Are you comfortable holding a maturing tech giant with strong cash flow, but slowing revenue growth and rising competition from Microsoft and newer SaaS players?

Salesforce isn’t just a CRM company, it’s the global leader in enterprise relationship management, with over 43% market share and decades of customer loyalty. Its platform is expanding into AI and data cloud solutions, backed by a $6.3B free cash flow engine and recent acquisitions like Informatica to future-proof its offerings.

But Salesforce isn’t without risks: revenue growth is decelerating to 8 to 10% annually, the stock trades at a premium, and aggressive competitors are entering the space with lower-cost solutions. Recent technical signals suggest consolidation, not breakout.

That said, Salesforce’s loyal enterprise base, improving margins, and aggressive push into AI-enhanced productivity tools could fuel long term performance. It’s also one of the few large-cap tech companies with both high recurring revenue and strong profit goals.

If you’re building a portfolio focused on long-term cash flow, durable software leadership, and AI integration, not short-term momentum, CRM may be a core compounder worth holding. It’s not a moonshot, but it’s a workhorse for growth-minded investors who value fundamentals over hype.

Don’t know your risk tolerance? Get Kiana Danial’s risk management toolkit for free here

IDDA Point 3: Fundamentals

🔹Key Driver 1: Salesforce had a good start to 2025, with its first-quarter revenue reaching $9.83 billion, which is 7.6% higher than last year and better than what experts expected. Earnings per share also beat forecasts. The company raised its predictions for the whole year, expecting revenue to grow 8-9% and aiming to improve profits. Free cash flow rose 4% to $6.3 billion. One big growth driver is their AI tool, Agentforce, which saw a 60% increase in deals in the first quarter and now brings in $100 million a year. Many existing customers are expanding their use of it. 

🔹Key Driver 2: Salesforce is also buying other companies, including Informatica for $8 billion, which should help with data management and speed up AI development. Compared to similar companies, Salesforce’s stock looks cheaper, and it has a strong history of beating earnings expectations. Experts see potential for the stock to rise about 58%, based on expected earnings growth this year. There’s also talks on buying Asana, which would help it offer more tools for large businesses. These moves are meant to keep Salesforce strong in a very competitive market.

🔹Key Driver 3: The company spends a lot of money on sales and marketing to win new customers. But once a company starts using Salesforce, it’s hard and costly to switch, so they usually stick around. This means Salesforce won’t have to spend as much money getting new customers over time, which should help boost profits. They aim to improve their operating profit margin (how much money they keep after costs) to 30% by 2030.

🔹However Salesforce’s growth may be potentially slowing down. Even though the market for its kind of software is growing, Salesforce may only grow about 10% per year for the next few years. A big reason is that it already serves a lot of large companies, and there’s not as much room left to expand in that space. Also, its investments in AI (artificial intelligence) seem to be more about staying competitive than creating exciting new products.

🔹Even though growth is projected to be slower, Salesforce can still generate a lot of cash. It’s expected to make over $5 billion in free cash (after all expenses) in 2026 and nearly $19 billion by 2034. This strong cash flow helps support the idea that the company is still valuable, even if it’s not growing super fast anymore.

🔹Salesforce faces tough competition. It still holds the biggest piece of the customer relationship software market (about 43%), but rivals like Microsoft, Oracle, HubSpot, and monday.com are catching up. Smaller companies are improving quickly and going after the same types of customers, which could make Salesforce lower its prices or invest more to keep up.

Fundamental Risk: Medium

IDDA Point 4: Sentimental

Strengths

✅Strong Cash Flow Growth – Salesforce is expected to grow its free cash flow by 13% annually, reaching approximately $19B by 2034. This indicates a solid foundation for long-term value creation.

✅Sticky Enterprise Customers – Once a company starts using Salesforce, it’s hard to switch. This “stickiness” means stable recurring revenue and reduced future marketing costs.

✅Margin Expansion Opportunity – With a target of 30% GAAP operating margins by 2030 (up from today), profitability is expected to improve significantly as customer acquisition costs decrease.

Risks

❌Slowing Revenue Growth – Salesforce’s revenue growth is expected to hover around 8 to 10% annually, which is lower than peers like HubSpot or monday.com.

❌Expensive Valuation – The stock is currently priced $263 which is above is estimated intrinsic value of $204, meaning it’s seen as overvalued unless strong growth continues.

❌Rising Competition – Competitors like Microsoft, Oracle, and smaller fast-growing players are aggressively moving into Salesforce’s space, potentially hurting pricing power and market share.

Investor sentiment on Salesforce is cautiously optimistic, backed by strong customer retention, improving profit margins, and its CRM market leadership. Analysts mostly rate it a “Buy,” driven by expected profitability rather than rapid growth. Concerns include slowing revenue, reliance on acquisitions over organic growth, and rising competition from Microsoft and HubSpot. AI initiatives are seen more as defensive than innovative. 

While the stock trades at a premium reflecting margin confidence, risks around growth stagnation and differentiation remain. Agentforce and the Informatica acquisition offer growth potential, but the latter’s long timeline and modest recent growth, partly due to currency effects, limit enthusiasm. The focus on margins and cash flow is positive, but consistent growth is needed to maintain investor confidence.

Want our top stock picks and analysis every month? Get our monthly newsletter here. 

Sentimental Risk: Medium

IDDA Point 5: Technical

On the weekly chart:
🟨 The current pattern is choppy and appears to be in consolidation.
🔻 The future Ichimoku cloud is bearish and flat, suggesting that the bearish momentum is not strong.
🔻 Current candlesticks are just below the cloud, with the cloud acting as resistance.

On the daily chart:
🟢 The future Ichimoku cloud is bullish and thin, signaling that the bullish momentum may be short term.
🟨 Candlesticks are currently inside the cloud, indicating market indecision – neither bullish nor bearish sentiment.
🔻 The Kijun line has recently crossed below the Tenkan line, forming a death cross, which is an early bearish signal.

On the weekly chart, we can see that the stock was growing up until 2022, after which it entered a sharp decline. From 2023 onward, it went on an uptrend, although it has been somewhat choppy and currently appears to be consolidating. The future Ichimoku cloud is bearish and flat, and the current candlesticks are trading below the cloud, which acts as a resistance zone.

On the daily chart, the future Ichimoku cloud is bullish but thinning, indicating that the bullish momentum could be short term. The candlesticks are trading within the cloud, signaling market indecision. The Kijun line has just crossed below the Tenkan line, forming a death cross, which is an early bearish signal.

Based on these two charts, since the daily chart is showing early bearish signals and a slowing of bullish momentum, it is likely that the candlesticks may not break through the resistance zone in the longer term outlook. The pattern may continue consolidating unless there is a strong change in market sentiment.

The current market price has touched the 38% Fibonacci retracement level.

Investor looking to add CRM to their portfolio can consider these buy limit entries:

📌275.64 (High Risk)

📌247.30 (Medium Risk)

📌217.98 (Low Risk)

Profit taking levels can be considered at these levels:

🎯367.84 (Short term)

🎯425.10 (Medium term)

🎯460.36 (Long term)

Here are the Invest Diva ‘Confidence Compass’ questions to ask yourself before buying at each level:

1. If I buy at this price and the price drops by another 50%, how would I feel? Would I panic, or would I buy more to dollar-cost average at lower prices? (hint: this question also reveals your CONFIDENCE in the asset you’re planning to invest in).
   
2. If I don’t buy at this price and the stock suddenly turns around and starts going up again, will I beat myself up for not having bought at this level?

Remember: Investing is personal, and what is right for me might not be right for you. Always do your own due diligence. You should ONLY invest based on your own risk tolerance and your timeframe for reaching your portfolio goals

Technical Risk: Medium – High

Final Thoughts on Salesforce (CRM)

Salesforce started 2025 strong, beating Q1 revenue and earnings forecasts and raising full-year guidance, supported by solid free cash flow and rising adoption of its AI tool, Agentforce.

Strategic moves like the $8B Informatica acquisition and interest in Asana aim to strengthen its AI and data capabilities. However, with revenue growth slowing to 8–10% and competition intensifying, concerns about valuation and market saturation remain.

While the technical chart shows consolidation and early bearish signals, investor sentiment is cautiously optimistic, backed by loyal customers, margin expansion targets, and strong cash flow.

➡️ Recommendation: Buy or Hold / Moderate Risk, Long-Term Growth Asset
Salesforce (CRM) offers a solid opportunity for long-term investors seeking steady cash flow and enterprise software leadership. While growth is slowing and competition is rising, its loyal customer base, improving profitability, and strategic AI investments support a moderately bullish outlook for those with patience and a long-term view.

Overall Stock Risk: Medium

Want to become a self sufficient Triple Compounder who no longer needs to read this blog?

Attend this free Triple Compounding Training here 👇👇

If you enjoyed my blog post about the ‘Is Salesforce (CRM) Stock a Buy in 2025? 3 Key Drivers Behind Its AI and Profitability Push’, you’ll love my post on ‘Is Joby (JOBY) Aviation Poised for Takeoff? 3 Growth Signals in the Race for eVTOL Urban Air Mobility Dominance’

Disclosure: I am not a financial advisor, and this is not financial advice. This information is for educational purposes only. This post about ‘Is Salesforce (CRM) Stock a Buy in 2025? 3 Key Drivers Behind Its AI and Profitability Push’ may contain affiliate links, meaning I get a commission if you decide to make a purchase through my links, at no cost to you. Please see the terms of service page for more information.