Kyle Reidhead
CEO & Analyst of Milk Road/Milk Road AI
SaaS is more needed than ever because AI agents rely on secure, well-organized SaaS tools to do their jobs, which the market keeps getting wrong. Even when users stop opening apps such as Gmail, Notion or Quickbooks, they keep paying because their agents use them, and agents could not build equally secure, reliable replacements. Agents also drive far more work per day, requiring better data, CRM and content tools, which supports Salesforce and Snowflake at current prices. x.comÂ
Falling AI token prices are bullish for Salesforce, ServiceNow and Palantir, which buy intelligence by the token and sell outcomes by the seat or workflow. Token prices just fell below $1 per million, halving input costs in three months, which should expand margins for these resellers and their customers. Cheaper tokens make previously unprofitable agents profitable, so spending rises: prices are down over 90% since 2023, yet inference spend has roughly doubled since late 2025. x.comÂ
Adobe, Salesforce and ServiceNow still generate massive cash flow, push deeper into AI and sit at the center of enterprise operations. Three of the biggest SaaS names remain beaten up in 2026; their valuations have been crushed, but the long-term opportunity may not have been. The market has swung way too far against them. x.comÂ
AI will not replace Fortune 500 CRM platforms, as the moat of Salesforce, ServiceNow and HubSpot goes beyond the software. It lies in the data model, integrations, workflows and customer records; agents may even raise the value of a trusted system of record. Thin workflow tools are vulnerable and seat pricing faces pressure. Platforms that make AI a native operating layer to expand usage and monetization should be pretty good investments; they look near the end of a multi-year correction. x.comÂ
AI agents are starting to do for free what Snowflake and other cloud software companies charge subscriptions for, erasing their pricing power. The same AI is a revenue engine for chips, as infrastructure spending flows through Nvidia, AMD and TSMC hardware. The split shows in markets: SOXX is up 25% from its March low while WCLD fell 5% and Snowflake 8.4%. x.comÂ
Salesforce's poor M&A is literally half the reason its multiple stays low. Slack and Informatica are cited as examples, with Braze raised as a question; AI making Tableau obsolete in a few years would be a separate risk, not itself poor M&A. x.comÂ
Agentic AI strengthens the platforms that give agents a governed home rather than killing SaaS. Agents need persistent identity, permissions and shared memory, which lock them inside existing systems of record and turn each workflow into higher-value consumption. ServiceNow grew subscriptions 21-22% while its stock halved, and 60% of Salesforce Agentforce bookings come from existing customers. UiPath and Palantir also orchestrate agents. The selloff priced a broken model, not this. x.com x.com … Show more
Salesforce faces real AI threats: more competition, margin headwinds from compute costs and disruption risk for businesses like Tableau and Service Cloud. Agentforce is showing some momentum, and the stock felt oversold earlier, but it is not attractive at current levels. x.comÂ
AI is becoming a cash-generation tailwind for SaaS companies, as Snowflake shows. Falling token prices let them add AI for minimal or controlled spending, producing packaged services with controlled margins and rising revenue, a recipe for more cash and shareholder returns, which is what the market now rewards. Hardware names like TSMC and NVIDIA already fit that profile, while Alphabet, Microsoft and Meta are slowing cash generation and planning to raise share counts. x.comÂ
These software names get stronger as AI grows, despite the early-2026 "AI will kill SaaS" sell-off. ServiceNow is becoming the control room that manages companies' AI agents. Salesforce's Agentforce brings in $1.2B a year and is tripling; Atlassian clients using Rovo spend twice as much; Adobe's business-safe Firefly earns $250M; Workday's agents bring nearly $500M. SAP and Snowflake hold the data AI needs, and Datadog monitors the extra systems AI creates, with the AI wave still early. x.com … Show more
Salesforce is underweight because it is adding debt for buybacks just as its AI pivot makes growth less certain. It issued $25 billion of senior notes to fund an accelerated buyback, and S&P revised its outlook to negative as leverage nears the 2x downgrade trigger; weak demand forced a 40 basis point concession. Core SaaS growth is slowing to high single digits, and Agentforce plus Data 360, at $2.9 billion ARR, are under 7% of revenue, exposed if AI seat cannibalization outpaces usage credits. … Show more
Salesforce's usage-based AI billing can expand revenue beyond traditional software seats. Agentforce ARR has surpassed $1.5 billion, with year-over-year growth more than doubling, while Data 360 supplies customer data for its agents. At about 14-15x forward earnings and a 7.8-8.2% trailing free-cash-flow yield versus the S&P 500 median of 4.5%, Salesforce is a top candidate for returning institutional capital seeking both defense and growth. x.comÂ
