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In today’s Cloud Wars Minute, I discuss Marc Benioff’s recent comments about ServiceNow, contrasting its growth and market potential with Salesforce, and explore how this competitive tension might impact both companies moving forward.
Highlights
00:18 — Jim Cramer hosted Marc Benioff, the Salesforce CEO, and Carl Eschenbach, the CEO of Workday, on his CNBC show. At one point, Cramer asked Benioff, “Well, how about ServiceNow, right? Aren’t they a big competitor here?” Benioff said, “No, Jim, it’s nothing like that . . . that’s like comparing Wienerchnitzel (ServiceNow) to McDonald’s (Salesforce).”
01:22 — Wienerschnitzel is regional, relatively small compared to McDonald’s, but very successful. It was a fairly gratuitous shot; Benioff, over time, is going to regret making that comment because ServiceNow is a high-flyer and beginning to build momentum.
02:36 — Last quarter growth rate: 11% for Salesforce, 22% for ServiceNow. Guidance for the next quarter, Salesforce dropping to 7% to 8% growth; ServiceNow has come in at 20.5%. Current remaining performance obligation growth is 10% for Salesforce, 22.5% for ServiceNow. Total RPO, 15% for Salesforce; 31.5% for ServiceNow. Market caps: Salesforce’s is $255 billion;. ServiceNow’s is $170 billion.
Ask AI Ecosystem Copilot about this analysis
03:55 —Marc Benioff is a colorful character. He’s been an iconic leader for a quarter-century. He’s done some remarkable things. He loves to be the showman. He loves to crack jokes. I think his company is, if not struggling, stumbling a bit right now. Its growth is slowing. It has to form this partnership with Workday.
05:05 — I think this was a poor choice of words by Benioff. It’s a backhanded insult that he is going to come to regret because ServiceNow is flying high at a time when Salesforce is having trouble finding its way into the future with any sort of respectable growth.
