Salesforce narrows hiring to sales roles as AI drives engineering efficiency
CEO Marc Benioff cites AI coding agents for productivity gains; shares remain subdued as full-year guidance slightly misses consensus despite strong quarterly earnings.
Salesforce CEO Marc Benioff has announced a strategic shift in workforce expansion, narrowing the company’s hiring focus exclusively to sales positions while maintaining a flat engineering headcount for the past two years. Speaking on the company’s earnings call, Benioff emphasised that hiring decisions are now “more focused than ever,” with growth concentrated under Chief Revenue Officer Miguel Milano rather than the technical divisions led by Chief Engineer Srini Tallapragada.
The decision follows the elimination of approximately 4,000 customer support roles last September, a move aligned with the company’s broader push toward agentic artificial intelligence. Benioff noted that while AI coding agents have significantly boosted efficiency within Tallapragada’s team of 15,000 engineers, the company still requires human intervention in sales to navigate complex market segments and drive margin expansion.
Financially, Salesforce reported adjusted earnings of $3.88 per share and quarterly revenue of $11.13 billion, both figures surpassing analyst expectations. The results were bolstered by $27 billion in stock repurchases, which reduced the share count by 10%. However, the stock remained subdued as full-year revenue guidance of $46.05 billion slightly missed the $46.12 billion consensus estimate, reflecting investor caution regarding the timeline for AI-driven profitability.
This restructuring mirrors a wider trend across the technology sector, where major firms are leveraging AI to reduce workforce sizes. Companies such as Amazon, Meta, Oracle, and Block have recently implemented significant layoffs, with Oracle reportedly cutting up to 30,000 roles and Amazon slashing 16,000 positions this year. Salesforce co-founder Larry Ellison continues to exert considerable influence over the company’s strategic direction amidst these industry-wide efficiency drives.
Looking ahead, Salesforce has set current quarter revenue guidance between $11.27 billion and $11.35 billion, missing the $11.36 billion street expectation. While the company has demonstrated strong earnings power, the slight miss in forward guidance has tempered market enthusiasm, highlighting the scrutiny software stocks face regarding the tangible financial impact of AI integration.
