According to investment firm Citi, Salesforce’s recent price increases might not have a significant impact in fiscal 2024. However, the long-term effects could be substantial. Analyst Tyler Radke, who holds a buy rating and has set a price target of $230 for Salesforce (NYSE:CRM), believes that the overall price increase is being perceived positively, as the company’s strong market position is expected to minimize customer attrition.
In fiscal 2024, Radke predicts that the price hikes will contribute less than $200 million in additional revenue. As for fiscal 2025, these increases could result in an approximate revenue boost of $700 million. Looking further ahead to fiscal 2026, the revenue surge could reach an impressive $980 million, representing a growth rate of approximately 2.6%. Radke’s previous sales forecasts for the full years of fiscal 2025 and 2026 were $34.8 billion and $37.7 billion, respectively.
Salesforce, led by CEO Marc Benioff, recently announced its decision to raise list prices by an average of 9% across Sales Cloud, Service Cloud, Marketing Cloud, Industries, and Tableau. These adjustments will go into effect starting in August and mark the company’s first price increases in seven years.
In pre-market trading on Monday, Salesforce (NYSE:CRM) shares experienced a slight decline.
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Author Faith Yakubu 
