In a notable shift in strategy, Salesforce is reorienting its approach to artificial intelligence (AI) by reducing its reliance on large language models (LLMs) and focusing more on deterministic automation systems. This change coincides with a broader management initiative aimed at cutting costs, which includes a significant reduction in its workforce.
CEO Marc Benioff has confirmed that personnel adjustments are directly tied to the company’s evolving use of AI technology. In an effort to enhance efficiency, Salesforce has reduced its support staff from approximately 9,000 to around 5,000, resulting in a loss of about 4,000 positions that have largely been replaced by AI agents. This shift is in line with the company’s Agentforce strategy, which utilizes AI to improve operational efficiencies.
These measures aim to enhance profitability, especially as Salesforce’s share price remains approximately 34% below its peak from December 2024. The focus on cost discipline signals an end to the phase of rapid headcount growth that characterized earlier years.
The core of this strategic adjustment is a move away from “pure” generative AI toward what Salesforce executives are referring to as deterministic automation. Over the past year, confidence in LLMs has waned, with reports of “AI drift” and reliability issues. In complex enterprise environments, these models often struggled to follow instructions accurately.
As a result, Salesforce is now prioritizing deterministic systems, which provide predictable, rules-based outcomes. This pivot aims to offer enterprise customers who require high precision greater certainty in their AI applications, distinguishing Salesforce’s approach from that of competitors such as Microsoft and Google.
Despite these strategic shifts, Salesforce’s financial performance remains solid. For the third quarter of fiscal year 2026, the company reported revenues of $10.26 billion, surpassing analyst expectations. Earnings per share (EPS) reached $3.25, significantly exceeding the consensus estimate of $2.86. The Agentforce platform is projected to contribute over $500 million in annual revenue, indicating early success in monetizing this AI initiative even as its technical direction is being refined.
The stock currently trades at a price-to-earnings (P/E) ratio of approximately 35, which is below its historical average. Market observers have noted a “Moderate Buy” consensus, though the recent caution regarding LLM deployment will likely lead to further scrutiny from investors.
Salesforce is currently consolidating around $265, with a significant support level noted at approximately $225, marking its most recent low. The anticipated growth driver will be the Agentforce platform, expected to generate incremental annual revenue exceeding $500 million.
As Salesforce navigates this period of strategic recalibration, its transparent communication about the limitations of LLMs and shift toward deterministic automation reflects a pragmatic approach to the enterprise AI market. The reduction of 4,000 roles, replaced by AI agents, underscores the company’s commitment to efficiency and margin protection. A critical factor for the stock’s future trajectory will be whether the Agentforce platform can fulfill its revenue promises, thereby supporting the current valuation.
For additional insights on Salesforce’s current market position and future prospects, investors can refer to the official Salesforce website at Salesforce.
As the landscape of enterprise AI continues to evolve, Salesforce’s decisive action may serve as a bellwether for other firms grappling with the challenges and opportunities presented by AI technologies.
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