Salesforce Freezes Engineering Hires After AI Boost
Salesforce will not be hiring any new engineers this year, according to CEO Marc Benioff, following a significant boost in productivity attributed to investments in AI coding tools. The announcement came during an earnings call where the CRM giant revealed its fourth-quarter results.
Benioff told analysts that Salesforce is experiencing “tremendous efficiency” as a result of its expenditures on AI agents and coding tools. “We definitely have seen a lot of efficiency with engineering and with some of the new… high-performance coding tools,” he stated. “It’s pretty awesome. And we’re not going to hire any new engineers this year. We’re seeing 30 percent productivity increase on engineering, and we’re going to really continue to ride that up.”
For the quarter ending January 31, 2025, the company reported revenue of $9.99 billion, representing an 8 percent year-over-year increase. Net income also rose, reaching $1.7 billion, up from $1.4 billion. However, the revenue figure fell slightly short of the expected $10.04 billion, missing guidance.
Salesforce’s forecast for fiscal year 2026 revenue ranges between $40.5 billion and $40.9 billion, which is less than the average analyst estimate of $41.35 billion,
Amy Weaver, president and chief financial officer, explained to investors that early adoption of Agentforce, the AI application for employee and customer support, had impacted the forecast. “On Agentforce, we are incredibly excited about the customer momentum we are seeing. However, the adoption cycle is still early as we focus on deployment with our customers. As a result, we are assuming a modest contribution to revenue in fiscal ’26. We expect the momentum to build throughout the year, driving a more meaningful contribution in fiscal ’27,” she said. Other factors influencing guidance include currency exchange rates and adjustments to the company’s professional services strategy.
Earlier this year, Gartner reported that businesses were continuing to invest in artificial intelligence, despite a high failure rate for some “moonshot” projects. John-David Lovelock, a distinguished VP analyst at Gartner, noted that the transformative AI work of 2024 is nearing completion and the high failure rate may have been due to under-investment. “The GenAI work that was done in 2024 — the transformational stuff, the moonshot projects — those are pretty much going to be over for 2025. They were maybe a little under-invested in and there were pretty high failure rates.
