Salesforce, a tech company based in San Francisco, saw its valuation drop by tens of billions this week following the release of a quarterly financial report that revealed less than stellar growth.
Salesforce, whose revenue for 2023 was $31.35 billion, typically sees its stock trading in the $270 range. But the stock fell sharply following the release of the quarterly report.
The stock value was $272.62 as of Wednesday at 4 p.m. Salesforce’s stock opened at $221.88 on Thursday morning, but by the time the market closed, it had dropped to $218.04.
That represents a value loss of 19.87% in less than a day. The company’s revenue dropped by nearly $50 billion as a result. There will be big effects from that loss for Salesforce’s 72,000 employees as well as stockholders.
Within the tech industry, accepting stocks as part of an employee’s compensation package is standard practice—sometimes taking the place of a larger salary. Up until this week, investing in stocks made perfect sense for a company like Salesforce.
Just two weeks have passed since Salesforce CEO Marc Benioff wrote to investors about the “remarkable year of transformation” the company is going through.
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Marc Benioff, Salesforce’s chief executive officer, wrote, “This has been a remarkable year of transformation for our company—restructuring our business for the short and long term; increasing productivity, profitability, and operational excellence across the board; doubling down on innovation and making our core products even better; and strengthening our relationships with all of you—our stockholders.” Marc Benioff added, “Our transformation is reflected in the strong results you saw throughout fiscal year 2024.”
Next month, investors in Salesforce are expected to gather for a meeting. They will cast their votes to decide the executive officers’ fiscal compensation for 2024 as well as whether Marc Benioff and other company executives will be appointed as directors.