Salesforce is opening a new AI hub in London. The CRM software firm said that the Salesforce UK AI Center would be located in the Blue Fin building and used as both a meeting point between Salesforce staff, AI experts, and prospective clients and a facility for training and upskilling its workforce to use new models. Salesforce added that it expected the new hub to help create half a million new AI-themed jobs throughout the UK – though investors have been left scratching their heads in recent weeks as to the coherence of its overall approach toward the technology.
“By locating Salesforce’s first, flagship AI centre in London,” said the firm’s UK and Ireland chief executive Zahra Bahrololoumi, “we are sending a clear message to customers and partners on AI: we are deeply committed to working closely together so that you can reap the rewards of this transformative technology, while ensuring it is a force for good,” Salesforce’s Bahrololoumi said in a statement.
Salesforce’s UK AI commitment
The investment in the new AI hub comes amid a $4bn investment announced in 2023 by the CRM firm into its UK arm, spread over five years – an infusion the company said was designed to help commercialise generative AI for its customers in the country. So far, the firm claims to have invested over £200m in British companies such as AutoGenAI and ElevenLabs through its investment arm, Salesforce Ventures. “AI has the potential to drive major growth for UK businesses – with the UK AI market predicted to reach over $1trn by 2035,” said Bahrololoumi, citing figures from the US International Trade Administration.
Salesforce’s decision to open its new AI centre in London was praised by the deputy mayor for business and growth, Howard Dawber, who said that the new facility would provide valuable training for residents in all things AI. It was also an endorsement of London’s growing importance as an AI hub in its own right, said the managing director of Grow London, Janet Coyle. “Our research shows that over three quarters (77%) of decision-makers at international AI companies consider London to be more supportive of AI development than other major AI hubs,” she said.
Market focus on generative AI depressing cloud software sales
Salesforce also announced that its proprietary Data Cloud service would now be available on Hyperforce for UK customers from 31 July. Both announcements come amid growing disquiet among investors about the general direction of the business, with its share price dropping by 18% after trading last week following its lowest-ever quarterly revenue growth forecast and reports that growth in billings had sunk to a record low of 3%. Analysts also pointed out anaemic growth market-wide for cloud software from March to April as firms prioritise spending on generative AI, something they concluded was bound to put pressure on Salesforce’s bottom line.
These results – the worst for the stock for 20 years – may lead some investors to resume their pressure on Salesforce to cease making large investments and acquisitions and refocus on attaining double-digit profits. Most, RBC Capital Markets Analyst Rishi Jaluria told Reuters, “wouldn’t react well to most large deals at this point. Given growth is slowing down, a big acquisition would be viewed as buying growth.”
