salesforce(CRM) Zhao Yin Guo Ji·2024-12-05 01:35Investment Rating - Maintain BUY rating with a target price of US336.5 [1][7] Core Views - Salesforce reported inline 3QFY25 results with total revenue of US2.32bn, up 12% YoY, both in line with consensus estimates [1] - cRPO grew 10% YoY on a constant currency basis, beating previous guidance of 9% YoY, driven by early renewals, strong booking performance, and momentum from Agentforce [1] - For 4QFY25E, Salesforce guided total revenue growth of 7-9% YoY to US10.05bn [1] - The company raised FY25E non-GAAP OPM guidance to 32.9% from 32.8%, driven by efficiency improvements and expense control [1] Financial Performance - Salesforce's revenue is expected to grow from US44.2bn in FY27E, with adjusted net profit increasing from US12.3bn over the same period [5][10] - Non-GAAP operating margin improved by 1.9ppt YoY to 33.1% in 3QFY25, with FY25E guidance raised to 32.9% [1] - Gross margin is expected to improve from 77.0% in FY25E to 78.3% in FY27E, while non-GAAP OPM is projected to rise from 32.9% to 35.9% over the same period [5] Growth Drivers - Agentforce, Salesforce's AI agent platform, saw strong demand with over 200 deals closed in 3QFY25, and the launch of Agentforce 2.0 in Dec is expected to further expand monetization opportunities [1] - AI-related deals more than tripled YoY to 2,000 in 3QFY25, with multi-cloud adoption continuing to show strong momentum, averaging over 5 clouds per top 25 deal [1] - Data Cloud, a foundation for AI implementation, was included in one-third of all deals over US410.0 per share based on 24x FY25E EV/EBITDA, a discount to the sector average of 31x, reflecting its more mature earnings growth stage [7][8] - The target EV/EBITDA multiple implies a target equity valuation of US14.1bn factored into the valuation [8]