BNP highlights bullish takeaways on agentic AI, growth in meetings with Salesforce, Workday, Snowflake
View original at seekingalpha.comBNP highlights bullish takeaways on agentic AI, growth in meetings with Salesforce, Workday, Snowflake [Humans are using laptops and computers to interact with AI, helping them create, code, train AI, or analyze big data with fast, cutting-edge technology.] BNP Paribas highlighted key takeaways, including agentic AI, g…
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Salesforce is doing all of the right things, but the share price will not likely react until Salesforce can 1) demonstrate stability in its core business and 2) demonstrate continued success and adoption of Agentforce along with Data Cloud
60% confidenceCompetition from Databricks is not new, and competitive fears appear to have died down from their peak a couple of years ago
60% confidenceData Cloud offering expected to ramp in second half, charged on consumption basis based on data amount
60% confidenceSalesforce has not seen any mass piping of data out of Salesforce to date
60% confidenceWorkday is returning to an organic product focus with a goal of delivering revenue growth acceleration, which may result in improved Bookings growth in H2 FY'27 and revenue growth acceleration in FY'28
60% confidenceFlex Credit revenues expected to start ramping up in fiscal year 2027 for new agentic offerings on outcome-based pricing
60% confidenceLLM costs will weigh on gross margins, but Salesforce can secure volume discounts and expects costs per token to come down over time
60% confidenceLLM costs will weigh on gross margins, but Salesforce can secure volume discounts and expects costs per token to come down over time
60% confidenceSalesforce benefits from customer data and metadata context, resulting in better and more accurate outcomes for agentic AI
60% confidenceLLM costs will weigh on gross margins, but Salesforce can secure volume discounts and expects costs per token to decline over time
60% confidenceMarketing business will stabilize with new product functionality ramping, but Commerce taking longer to improve due to competitive pressures and R&D resource allocation to AI
60% confidenceAI native revenues are likely less than 2% of total revenues but may have already helped drive the Q4 beat
60% confidenceLLM companies appear more focused on disrupting the applications market rather than entering data platform market
60% confidenceMarketing business will stabilize with new product functionality ramping, but Commerce taking longer to demonstrate improvements due to competitive pressures and R&D resource allocation
60% confidenceWorkday used to generate 60% of growth through existing customer base and 40% through new customers, but new customer growth has slowed in SLED, Healthcare, and retail sectors
60% confidence27 years of operational CRM data embedded within systems of record provides advantage versus new competitors
60% confidenceWorkday is returning to organic product focus with goal of delivering revenue growth acceleration, potentially improving Bookings growth in H2 FY'27 and revenue growth acceleration in FY'28
60% confidenceSome customers already replacing third-party point solution application functionality by running workflows directly in Snowflake
60% confidenceWorkday Data Cloud offering is expected to ramp up in the second half and will be charged on consumption basis based on amount of data
60% confidenceMargin targets may be lowered as company focuses on accelerating top-line growth and ensuring product portfolio is relevant in upcoming Agentic AI world
60% confidenceSnowflake is committed to maintaining product gross margins at 75% this year despite AI product margin headwind
60% confidenceCompetition from Databricks is not new, and competitive fears appear to have died down from their peak a couple of years ago
60% confidenceIf successful with new initiatives, second-half bookings should show improvement, potentially delivering revenue growth inflection in fiscal year 2027
60% confidenceAI is an opportunity to increase accessibility of Snowflake technologies to more business users beyond just business and data analysts by putting tools like CoCo in people's hands
60% confidenceCompany has not seen any mass piping of data out of Salesforce to date
60% confidenceAI native revenue is likely less than 2% but may have already helped drive Q4 beat
60% confidenceWorkday's integrated data model across HCM and Finance provides advantage as it increasingly sells the full suite
60% confidenceLLM companies like Anthropic and OpenAI appear more focused on disrupting the applications market rather than entering the data platform market
60% confidenceSalesforce's 27 years of operational CRM data embedded within its systems of record provides advantage versus both startup competitors and DIY approaches
60% confidenceCustomers finding value in using Snowflake's own coding tool for data operations because it better identifies patterns and context within Snowflake data while benefiting from Snowflake security and governance
60% confidence
Data points we hold from this source
| Snowflake Inc. · gross margin target | 75 percent |