'AI 3.0 is the interface': Salesforce stock pops on BoA upgrade

Salesforce stock ( CRM ) rose as much as 5% Monday morning after Bank of America upgraded it to Buy from Underperform after deciding that previous worries that AI would cut Salesforce out of enterprise software were overdone.

BofA analyst Tal Liani raised his price target to $285 from $160, a 78% increase. The new target sits about 24% above Friday's close of $229.13. The stock was up about 2% shortly before 10 a.m. ET.

"If AI 1.0 was the model, AI 2.0 was the agent, then AI 3.0 is the interface," Liani wrote in a note to clients Monday.

That shift was the risk BofA had flagged earlier: As workers hand tasks to AI assistants, they may stop opening Salesforce apps at all. That fear hammered many software stocks for a stretch, though the group has rallied sharply since the end of June , with Salesforce among the top performers.

Conversations with chief information officers and other market participants changed BofA's call. Large companies, the note said, are unlikely to replace the platforms that house their business logic, data, workflows, and compliance frameworks.

"If anything, AI should deepen dependence on these platforms," Liani wrote.

BofA argued that Salesforce covers all four layers a company needs to put AI to work: data (Informatica and Data 360), applications (Sales Cloud and Service Cloud), agents (Agentforce), and the interface (Slack, Claudeforce).

The "SaaSpocalypse" narrative, the firm added, "overstates the extent to which losing the user interface translates into losing platform value for Salesforce."

BofA also sees early signs that growth will pick up, including strong growth in net new annual order value, a bookings measure, and faster gains at Slack. It raised its forecasts for subscription and support revenue growth in fiscal 2028 and 2029 to 10.4% and 10.5%, from 9.9% and 10.2%.

The main near-term risk, according to the note, is that companies adopt AI more slowly than expected, since Salesforce's AI revenue is still small.

Internal AI tools help analyze research notes and draft. Editors reviewed, edited, and fact-checked this post before publication.