(Reuters) -Business software provider Salesforce forecast third-quarter revenue below Wall Street estimates on Wednesday, as clients dial back spending on its enterprise cloud products due to macroeconomic uncertainty.
The cloud software provider also announced a $20 billion increase to its existing share buyback program, bringing the total to $50 billion.
Shares of the San Francisco, California-based company fell more than 4% in trading after the bell. The stock has lost more than 24% of its value so far this year.
Enterprises are postponing their large IT spending plans due to a weakening global economy amid ongoing macroeconomic and geopolitical issues.
At the same time, investors have been on the heels of cloud firms to show returns on the billions poured into artificial intelligence as Salesforce invests heavily in automation and AI agents.
CEO Marc Benioff said last week that Salesforce has cut 4,000 jobs in customer support due to AI, after earlier saying that the technology accounts for about 30% to 50% of the company’s work.
The company has been offering AI agents — programs that can handle routine tasks without human supervision — to businesses for recruiting and customer service. It has over 4,000 paid deals for “Agentforce,” a platform that allows customers to create AI-powered virtual representatives.
For the third quarter, Salesforce sees revenue between $10.24 billion and $10.29 billion, with the midpoint coming below analysts’ average estimate of $10.29 billion, according to data compiled by LSEG.
On an adjusted basis, Salesforce expects earnings per share between $2.84 and $2.86, with the midpoint of $2.85 per share coming in line with analysts’ estimates.
The company’s revenue for the second quarter, ended July 31, was $10.24 billion, beating expectations of $10.14 billion.
(Reporting by Juby Babu in Mexico City; Editing by Alan Barona)
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