“With Salesforce’s distribution and selling capabilities, Slack would instantly be propelled into C-level executive dissuasions across industries” - Alex Zukin, analyst with RBC Capital However, analysts suggest the Salesforce deal could be a boon for Slack further down the road. The third quarter’s results show paid customers have turned their backs on Slack for more attractive, bigger-name products like Microsoft Teams and Zoom. In the first quarter, the company had reported having just over 122,000 paid customers - adding 12,000 in the three months to the end of April, up 28% from Q1 2020. In its most recent 10-Q filing, Slack CEO Stewart Butterfield cited business budget cutbacks as a reason for customer churn: paid customers were deciding not to renew their subscriptions.Īs of the end of 2Q21, Slack had 130,000 paying customers, up 30% year-over-year. We see higher risk at current levels” - Morgan Stanley analysts “Massive work-from-home demand for collaboration tools may end up doing more harm than good for Slack. According to Zacks Equity Research, five analysts had forecast revenue to be in a range of $231.93m–$238.3m, with a consensus of $234.67m. The earnings report for the third-quarter fiscal year 2021, released by the company on 1 December, showed revenue of £234.5m, up 39% year-over-year on the $168.72m revenue reported in Q3 2020. We see higher risk at current levels,” wrote analysts at Morgan Stanley, who downgraded the stock from equal weight to Underweight and set a price target of $27. The release of a report by Morgan Stanley towards the end of October didn’t help - this declared that Slack was no longer a beneficiary of the work-from-home trend, with potential customers choosing rival products, including Microsoft Teams and Zoom. Between the market correction in early September and news of the Salesforce deal, the stock was down circa 11%. Slack's Q3 revenue - a 48.9% rise from Q2ĭespite signs of strength in these numbers, Slack’s share price has struggled of late.

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