Like most tech stocks Salesforce (CRM) had a nice bounce off its May lows but that rally may be coming to an end. CRM reported 2Q22 earnings after the close Wednesday and the results clearly show revenue growth decelerating.
CRM guided 3Q22 revenue growth to only +14% year over year. As a result they lowered full year revenue growth guidance from +20% to +17%. This is going to nick EPS as well which they lowered guidance from $4.74-$4.76 to $4.71-$4.73. CRM shares are -6% in the after hours.
This kind of report – similar to yesterday’s from Zoom (ZM) – supports my contention that the monetary tightening already in the system is starting to hurt economic growth. The technicians got extremely bullish last week due to the price action but it was likely a bear market rally and growth is the next shoe to drop as we slip into recession.