Salesforce Dunks on AI Fears, Ted Sarandos Kisses Washington's Ring

Hey there Folks,

In this evening’s edition, we have Salesforce getting a break from Anthropic’s waterboarding, and Ted Sarandos getting his Art of the Deal on with Trump… 

Let’s get started…

- IMHO, Salesforce earnings felt like the brief moment in between water boards… 

I can only imagine Marc Benioff is getting his Pete Weber on after Salesforce's earnings… especially considering the company just posted its best growth in two years… 12% YoY revenue, a clean beat on both lines.

In the new age of SaaS is dead, this qualifies as a miracle. Adjusted EPS came in at $3.81 versus the $3.04 the Street expected… a 25% beat that would've been a face-melter in any other environment. Revenue hit $11.20B against $11.18B expected, current RPO clocked in at $35.1B versus $34.5B consensus, and Benioff's AI baby is now running at an $800M annualized clip. Suck it, Anthropic…

However, the guidance was more of a shrug than a fist pump. Fiscal 2027 full-year revenue came in at $45.8B–$46.2B, implying 10%–11% growth… roughly in line. But in a market where every SaaS name has been getting repriced around existential AI disruption fears, "roughly in line" usually gets you taken behind the barn.

And yet, the market looked at the full picture and decided the beating had gone far enough. Benioff helped the case with the most Big D*ck Energy buyback announcement in recent memory: $50 billion in new repurchases. His exact words: "because these are some low prices." When you're down 28% and you back up the truck with $50B, that's a statement.

That said, the real banger is Salesforce's strategic investments generating an $811M gain this quarter (up from $96M a year ago). Benioff basically said he wishes he'd gone harder on Anthropic: "We're at about $330 million invested… believe me, I wish we had invested a lot more." The man watched his own stock get body-slammed by AI fears all year, and his side bet on the company doing the slamming printed $811M in a single quarter.

Meanwhile, the Informatica acquisition ($8B) kicked in $399M of revenue and bumped the fiscal 2030 target to $63B. Benioff also couldn't resist claiming five ServiceNow customers defected to Salesforce. Petty, much?

The broader read is cautiously encouraging if you're long. Net income grew. Bookings grew. The AI product is ramping. But don't get comfortable… the repricing isn't over just because one company posted a clean quarter. However, if you've been waiting for a sign that the Street can still differentiate between companies getting disrupted and companies doing the disrupting… yesterday's print was a decent data point. 

- Melania 2 may come early… 

In case you missed it, Ted Sarandos is flying to the White House today to talk about the WBD deal, five days after Trump publicly told Netflix to fire a board member or "pay the consequences."

Read that again if you need to.

In short, the whole Netflix-Paramount-WBD cage-match has officially left the red room and entered the West Wing, which… shouldn't surprise investors even a little. But the speed of capitulation here is still something. Five days ago, Trump hopped on Truth Social and demanded Netflix fire board member Susan Rice… former Obama official, current Netflix director, and apparently the woman standing between Sarandos and the deal of a decade. Trump called her "racist" and a "political hack". Translation: Nice merger you've got there, shame if something… I don't know… happened to it.

And now Ted's making the trip to suck up while Paramount, backed by David Ellison (son of Oracle daddy Larry Ellison, Republican megadonor, guy who basically has a season pass to Mar-a-Lago), just jacked its bid to an all-cash $31 per share for all of WBD. 

But alas, Trump said weeks ago he'd stay out of the bidding war. That lasted about as long as Sam Altman's "no ads ever" promise. One Lauren Loomer post later and now sh*t has hit the fan while the DOJ is sniffing around Netflix's proposal on antitrust grounds.

So yeah… congrats, you now know what the epitome of a clusterf*ck looks like. Netflix wants the WBD studio and streaming assets. Paramount wants the whole company. One bidder's CEO is getting his Art of the Deal on with Trump's Senate Allies. The other bidder's CEO is now apparently auditioning for a board seat purge just to stay in the game. The actual antitrust merits of either deal? Somewhere in the back of the line behind the political theater.

My take? Who knows what the actual hell will happen going forward. All I know is this drama is entertaining and good for my job security (read: more stories to cover). 

The Team at Bullseye Trades