Salesforce Is Facing a True Test, Ives Says
Speakers
Dan Ives
— Managing Director, Wedbush Securities
Summary
Dan Ives discusses the AI software landscape, highlighting Snowflake's strong quarter as proof of AI monetization, while Salesforce faces pressure to prove its AI strategy. He recommends owning chip stocks and avoiding legacy IT services, and speculates on a potential Tesla-SpaceX merger.
- Snowflake's quarter is seen as a seminal event for AI software monetization.
- Salesforce is under a 'true test' to execute on AI in the next 6-9 months.
- Investors are advised to continue owning semiconductor stocks.
- IT services and legacy software/infrastructure are sectors to avoid.
- Dan Ives sees an 80-85% chance of a Tesla-SpaceX merger within a year.
- Data ownership is the key differentiator between winners and losers in software.
- The market is a stock picker's environment based on AI exposure.
- CrowdStrike and Zscaler are cited as examples of winners and losers in cybersecurity.
Trade Ideas
Snowflake is benefiting from AI data layer.
Snowflake is in the sweet spot as the data layer for AI deployment. Companies need Snowflake as they go down the use case path, and its quarter was seminal, showing the data layer is critical. The stock should benefit from AI monetization.
Salesforce faces a critical test.
Salesforce faces a true test over the next six to nine months. It has green shoots but must prove it can monetize AI (Agentforce) across its customer base. While success is expected eventually, the stock is under pressure and investors need to see execution.
Continue owning semiconductor stocks.
Investors should continue to own semiconductor (chip) stocks as a key area of AI investment. Chip players remain beneficiaries of AI infrastructure buildout.
