Salesforce CEO Marc Benioff has repeatedly pushed back against warnings that AI could undermine the software-as-a-service (SaaS) business model. Now, as Salesforce with reporting accelerating demand for its AI products, the CEO is reaffirming his argument that rather than causing a “SaaSpocalypse,” the commoditization of AI models will increase the importance of enterprise applications and customer relationship management (CRM).
Benioff launched another forceful defense of enterprise software on the vendor’s second-quarter earnings call, arguing that the growing availability of AI models will strengthen the role of CRM rather than eliminate it.
Benioff pointed to growth in software seats, customer retention, contract lengths and AI usage as evidence that fears over AI agents destroying the traditional SaaS model have yet to materialize.
“This is the future of enterprise software, and I will tell you what it is not. This is not the SaaSpocalypse. We have been hearing about this for the last two quarters, these dire predictions about the end of software and how the models eat everything. But none of them have come true for us.”
The comments came as Salesforce reported second-quarter revenue of $11.35BN, up 11 percent year over year, while subscription and support revenue increased 12 percent to $10.82BN.
Annual recurring revenue for the Agentforce agentic AI platform reached $1.5BN, while Salesforce said customers generated 3.2BN agentic workspace units during the quarter, up 97 percent from the previous quarter.
AI Models May Be Commoditized, But CRM Remains the Context Layer
A central part of Benioff’s argument is that enterprises will increasingly consume AI through the software applications they already use rather than managing an expanding collection of foundation models themselves. The model will become increasingly abstracted from the customer.
“I believe what they are going to do is consume AI through packaged software... You are using Slack, you are consuming AI through packaged software. You are using Salesforce, you are consuming AI through packaged software.”
Benioff compared the position of AI models with other infrastructure that businesses typically do not interact with directly. “Do you even know what chip you’re using? Do you really know what data center you’re on? Do you know what router you’re on, what switch, what type of fiber, what cable you’re using, what interconnect you’re using?”
“At some level, we do get abstracted back to how the way the world used to be, which is we operate at a certain level of value. I believe the highest level of value is at the application layer,” Benioff added.
As the AI market becomes increasingly crowded with competing frontier and open models that have similar capabilities, the differentiation for enterprise buyers could increasingly sit in proprietary data, workflows, permissions, business rules, integrations and applications.
Salesforce is positioning CRM as a core part of that infrastructure.
“We are told the frontier models would eliminate the need for CRM,” Benioff said. “Instead, they depend on it, and we’re showing how 1 plus 1 can equal 3.”
Customer Vibe-Coding Experiment Reinforces Salesforce's Argument
Salesforce used a customer’s experience with “vibe coding” to reinforce the point that AI-generated software will not automatically make enterprise CRM platforms obsolete.
David Friedberg, CEO of agricultural technology company Ohalo explained that his company had experimented with building its own CRM using AI coding tools before ultimately choosing Salesforce.
“You quickly realize just how much it takes to do maintenance, to do accounts, to do security. There is just much more to it,” Friedberg said.
The experience led Ohalo to distinguish between software it could build itself and foundational enterprise systems it would rather buy.
“We’re not going to vibe code CRM... We are going to build custom interfaces.”
Friedberg's experience also offers an example of how AI coding tools can strengthen rather than displace an enterprise software platform. He said an employee named Ben used Claude and Cursor to customise Salesforce and get the company's system running in less than a month.
Benioff seized on the example as evidence that AI coding tools could make Salesforce more valuable by reducing the effort required to configure and administer the platform.
“I think that has been the huge shock for us, that these new next-gen tools, the Cursors, the Replit, the Claudes of the world, make our product better,” Benioff said.
