B2B tech outlook hinges on AI agents

With all eyes on earnings from Big Tech’s varsity squad (Google, Meta, Amazon, Nvidia) in October and November, focus has now shifted to the JV team of enterprise software companies: Box, Okta, Salesforce, and Snowflake.

While these B2B tech companies may not have the same brand recognition as the Magnificent Seven, how they perform can still tell us a lot about tech’s economic landscape. And they all beat expectations.

As the senior team is building (and making bank from) AI infrastructure, these enterprise tech companies are now figuring out how to fully integrate AI agents into their own software, as reflected in their Q3 earnings.

Okta outlook. The cybersecurity and single sign-on provider beat Wall Street’s third quarter expectations with revenue of $742 million, beating the predicted $730 million. Its adjusted earnings per share jumped to $0.82 over the expected $0.76. But despite these numbers, shares fell last week because of the company’s lack of guidance on the upcoming fiscal year.

Okta CEO Todd McKinnon told CNBC that the company’s AI offerings and revenue haven’t been fully incorporated into the results.

Analysts from JPMorgan said in a report released after its call that they “remain positive on Okta’s positioning to capture the agentic identity opportunity with improving sales execution.”

May the (Sales)force be with you. The customer relationship management giant also surpassed analyst expectations for earnings per share, with $3.25 vs. expectations of $2.86, while just skating under revenue predictions: $10.26 billion vs. an expected $10.28 billion. Its agentic AI Agentforce launched with some fanfare last October. It pulled in $500 million in the third quarter, making it the company’s fastest-growing product.

But Salesforce stock has underperformed this year compared to other tech companies, as there are “concerns about the potential of artificial intelligence replacing some of its product capabilities,” CNBC reported.

Thinking outside the Box. Box, the cloud and file sharing company, reported 9% YoY third quarter growth in its earnings call last week. Q3 revenue topped out at $301 million, beating investor expectations, and it also announced a new AI agent, Box Extract. Analysts on the call were interested in the company’s AI adoption plans, and CEO Aaron Levie said that its adoption of its AI solutions were “exceeding our expectations.”

In a report from Morgan Stanley, analysts wrote they “remain equal weight as Box needs to show more evidence it can bridge the gap to sustain its 10%–15% medium-term targets, which may require a few more quarters of execution and acceleration to prove the durability of growth.”

Don’t be a Snowflake. Snowflake, the cloud data storage, process, and consolidation company, took a hit on its share price, even though it also beat analyst expectations.

Last Thursday after its earnings call, shares dropped 11% as investors seemed to feel the company was overinvesting in AI and offering too many discounts on large, long-term deals. The company reported revenue of $1.2 billion for Q3 and 29% YoY growth, and announced a $200 million partnership with Anthropic.

So it looks like the JV can play ball.