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Salesforce sinks on weak outlook sparking AI concerns

STORY: Salesforce shares plummeted roughly 20% Thursday morning...

after the company forecast its lowest-ever quarterly revenue growth, and missed Wall Street estimates on profit outlook.

Its latest earnings figures, reported after Wednesday's market close, raised fears that high interest rates and rival AI offerings were hampering demand at the cloud-based software firm.

Salesforce also missed first-quarter revenue expectations, marking the first time since 2006 that that key metric fell short.

Some brokerages warned that Salesforce's forecast also meant software demand had slowed further in April.

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Activist investors pressured Salesforce last year to prioritize profitability after years of growing its business through big deals, including the $27.7 billion acquisition of Slack in 2021.

CEO Marc Benioff on Wednesday's post-earnings call said Salesforce could turn to large deals to accelerate growth if they were "accretive" and had "the right metrics."

Salesforce could lose roughly $50 billion in market value if Thursday's stock losses hold.