Salesforce CEO Marc Benioff Commends Palantir’s Growth but Questions Its Pricing Strategy
Marc Benioff, co-founder and CEO of Salesforce, recently acknowledged the impressive growth and investor interest surrounding Palantir Technologies, while simultaneously critiquing the high prices of its enterprise software offerings.
In an interview at Goldman Sachs’ Communacopia+Technology conference in San Francisco, Benioff expressed admiration for Palantir’s valuation multiples, remarking, “Oh my gosh. I am so inspired by that company,” and noting Palantir’s revenue multiples are 100 times, with a hope they might reach 1000 times in the future.
Despite Salesforce generating over $10 billion in quarterly revenue—making it about ten times larger than Palantir—Palantir’s revenue growth rate of 48% outpaces Salesforce’s 10% growth. This rapid expansion has attracted significant investor attention, reflected in Palantir’s market capitalization of $406 billion, which surpasses Salesforce’s $231 billion.
However, Benioff took a critical stance on Palantir’s pricing, describing it as “the most expensive enterprise software I’ve ever seen.” He suggested that Salesforce may be undercharging for its products, implicitly contrasting the two companies’ pricing models.
Benioff has voiced similar views previously, telling CNBC’s Jim Cramer that Salesforce offers a “very competitive product at a much lower cost” than Palantir. Palantir CEO Alex Karp responded by emphasizing the company’s focus on delivering substantial value and justifying their pricing accordingly.
The two firms occasionally compete for government contracts. Benioff highlighted Salesforce’s recent success in securing a U.S. Army contract over Palantir, underscoring the competitive dynamic between the companies.
Founded in 2003, Palantir went public in 2020, much later than Salesforce, which debuted on the stock market in 2004. Palantir has become a favorite among retail investors, particularly on platforms like Robinhood.
Salesforce shares have declined 27% year-to-date, marking the largest drop among large-cap technology stocks, while Palantir’s stock performance has been more resilient.
FinOracleAI — Market View
Benioff’s remarks highlight a recognition of Palantir’s strong growth trajectory and market enthusiasm, but his critique of pricing underscores potential concerns over enterprise software affordability. The competitive tension between Salesforce and Palantir, especially in government contracts, may influence investor perception of both companies’ future revenue streams.
Investors should watch Palantir’s ability to sustain high growth and justify its premium pricing amid increasing competition. Salesforce’s lower growth but larger scale and more competitive pricing present a contrasting yet stable investment profile.
Impact: Neutral
