Tag Archives: Salesforce.Com Inc

Business

Salesforce co-CEO Marc Benioff touts strong sales guidance, says ‘$30 billions are now ahead of us’

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Salesforce co-CEO Marc Benioff on Tuesday broke down the enterprise software giant’s latest financial results, telling CNBC’s Jim Cramer it was “maybe the best quarter we’ve ever had.”

Shares of Salesforce, which have struggled mightily over the past three months, jumped 3% in extended trading Tuesday, as Wall Street reacted to the company’s fourth-quarter figures. Both revenue and per-share earnings topped estimates, while full-year outlook for fiscal 2023 also is better than analysts expected.

“This was an extraordinary quarter, maybe the best quarter we’ve ever had, and you can really see it not just in the quarterly guidance, but where we’re looking for next fiscal year,” Benioff said, noting San Francisco-based Salesforce is expecting revenues between $32 billion and $32.1 billion in fiscal 2023.

That’s above the $31.78 billion that analysts surveyed by Refinitiv had projected.

Salesforce saw revenues of $26.49 billion in fiscal 2022, so the high end of its revenue 2023 guidance would represent an increase of just over 21% year-over-year.

“We’re leaving the $20 billions behind, and the $30 billions are now ahead of us,” said Benioff, who co-founded Salesforce in 1999.

He said Salesforce’s next leg of growth continues to be propelled by the digital transformation and its customers needing a broad range of tools to support their own clients. That’s why Salesforce has worked to stitch together all of its recent acquisitions, Benioff said, pointing to data analytics firm Tableau, integration software provider MuleSoft and chat app Slack.

Benioff also said he’s pleased with Salesforce’s operating cash-flow performance and projections. The company reported $6 billion for fiscal 2022, up 25% year over year, and with expectations of 21% to 22% growth in fiscal 2023.

Dow-component Salesforce shares are up 7% over the past five sessions, but they remain down nearly 27% over the past three months as investors have rotated away from growth-oriented technology companies toward more defensive parts of the market.

Disclosure: Cramer’s charitable trust owns shares of Salesforce (CRM).

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Business

Salesforce promotes Bret Taylor to co-CEO

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Salesforce’s Bret Taylor at Dreamforce 2017

Salesforce

Salesforce on Tuesday promoted Bret Taylor to the role of co-CEO, alongside Marc Benioff, who co-founded the company in 1999.

Taylor joined Salesforce in 2016, through the $412 million acquisition of his productivity software start-up Quip, which he co-founded four years earlier. Taylor quickly moved up the ranks to become president and chief product officer, and he now participates in quarterly earnings calls with analysts.

“Bret is a phenomenal industry leader who has been instrumental in creating incredible success for our customers and driving innovation throughout our company,” Benioff said, in a press release announcing the promotion. “Together, Bret and I will lead Salesforce through our next chapter, while living our shared values of trust, customer success, innovation and equality for all.”

Before starting Quip, Taylor helped create Google Maps, sold social networking start-up FriendFeed to Facebook, and spent three years as Facebook’s technology chief. Taylor sits on Twitter’s board of directors, and on Monday was named chairman as part of Jack Dorsey’s departure as CEO.

Taylor received $13.9 million in total compensation for the 2021 fiscal year, mostly from stock awards, according to Salesforce’s most recent proxy statement. He owns about $329 million worth of Salesforce shares, according to FactSet. Taylor received Salesforce stock in exchange for his Quip holdings.

The last time Benioff named another CEO of Salesforce came in 2018, when former Oracle executive Keith Block became co-CEO alongside Benioff. But Block stepped down less than two years later, and Benioff removed the “co” from his title.

Taylor told people he was expecting to get the CEO job soon, the Information reported on Oct. 7.

“Marc has been my mentor, my greatest supporter and my trusted friend for years,” he said in Tuesday’s statement. “Partnering with him to lead the company he co-founded 22 years ago is an enormous privilege.”

Salesforce is the largest employer in San Francisco, drawing tens of thousands of attendees each year to its Dreamforce conference, where Benioff expounds on business trends. Benioff regularly engages in politics, directs money to philanthropic causes and, with his wife, Lynne, acquired ownership of Time Magazine from Meredith Corp in 2018.

Salesforce has expanded beyond its core of providing cloud-based software for sales reps, with products for customer service, marketing and commerce. Acquisitions of MuleSoft, Tableau and most recently Slack have also helped Salesforce grow.

Last year, Slack CEO Stewart Butterfield told Taylor that Slack was interested in acquiring Quip from Salesforce. Taylor told Butterfield that wasn’t happening, but he later brought up the idea of Salesforce buying Slack, according to a regulatory filing. The $27.1 billion deal closed in July.

Taylor graduated from Stanford

WATCH: Jim Cramer’s interview with Marc Benioff

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Technology

Microsoft launches Loop Office app for real-time collaboration

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Microsoft CEO Satya Nadella speaks at the company’s annual shareholder meeting on Nov. 30, 2016, in Bellevue, Washington.

Stephen Brashear | Getty Images News | Getty Images

Microsoft said at its online-only Ignite conference on Tuesday that it will release a new Office application called Loop that people can use to collaborate on projects.

The effort shows Microsoft is attempting to provide more value to Office subscribers, which will start paying higher prices next year. That should boost financial results for the world’s most highly valued public company.

Microsoft’s Office subscription bundles already come with Word and Excel, where people can be co-authors on text documents and spreadsheets. And the SharePoint tool gives workers online hubs for accessing relevant files. Loop promises a modern alternative, which is important because Microsoft’s core productivity software increasingly faces pressure from well-funded start-ups such as Airtable, Coda and Notion, which aren’t weighed down by proprietary file formats.

Emerging productivity software from those companies can handle content creation, but they’re lacking in communication, said Jared Spataro, a Microsoft corporate vice president. Workers can share Loop elements in Teams text conversations. Users can quickly discuss Loop projects by kicking off voice or video calls in Teams, which has grown to more than 250 million monthly active users following the onset of Covid-19, he said.

“Essentially what we’re doing with Loop is we’re blowing up the document,” he said.

The combination of communication and creation is more well suited to hybrid work configurations, where not everyone is located in the same physical space, Spataro said. That’s important now that the pandemic has pushed many organizations to adopt remote work at a greater scale. Cisco’s Webex, Salesforce’s Slack and Zoom have all developed enhancements to better accommodate hybrid work.

Microsoft’s Loop shows where people’s cursors are located as they view and contribute to pages.

Microsoft

Loop contains three elements:

Components. Multiple people can simultaneously read and contribute to these miniature documents. Drawing on the Fluid Framework technology that Microsoft first talked about in 2019, Loop components can appear in multiple Microsoft applications. They’re coming first to OneNote, Outlook and Teams, starting this month. Components stay up to date across different applications, so people don’t have to worry about sharing the latest version of a file.

Microsoft has developed ready-to-use Loop components for voting on ideas and tracking the status of projects, and the company said a Loop component could also be as robust as a customer record drawn from the Dynamics 365 cloud service for tracking sales opportunities. Third-party developers will be able to build Loop components, too.

Pages. These are full-on documents in which people can type text, enter reactions and find related Loop components, links and documents. The user interface shows other users’ cursors to give a sense of what people are doing in the document right at a given moment, similar to the redesigned Whiteboard digital brainstorming app in Office.

Workspaces. These are areas where people can check progress on shared initiatives and enter reactions, as a casual hub for project management. People can reach multiple pages from a workspace.

Even though Loop promotes the presentation of information across various programs, Microsoft will provide a dedicated Loop application where people can quickly get to Loop content. The idea for the app came from Microsoft employees who were using Loop components internally and realized it was hard to locate and organize them, Spataro said.

Microsoft will begin a preview of Loop’s application, workspaces and documents in the first half of next year, Spataro said.

WATCH: Jim Cramer on why Microsoft had ‘the best quarter of the year’

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Business

Microsoft launches Teams phone features as Zoom rivalry continues

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Microsoft CEO Satya Nadella gestures as he speaks during a Bloomberg event on the opening day of the World Economic Forum in Davos, Switzerland, on Jan. 21, 2020.

Simon Dawson | Bloomberg | Getty Images

Microsoft said Monday it’s adding features for its cloud-based calling service that will make it more competitive against Zoom.

Microsoft is upgrading its Teams Phone service — which is part of the Teams communication app — to include the ability to transfer calls among devices, take calls in vehicles through Apple’s CarPlay and transcribe calls. It will also be able to identify spam calls, integrate contact center software and make calls to five additional countries through calling plans.

Zoom Phone has all these features already, according to Zoom’s website, though the spam service is still in beta. But Microsoft is also enhancing Teams Phone with a detail that Zoom is missing. In October, Teams Phone will add a virtual walkie-talkie, allowing users to push a button to talk.

Microsoft has been investing heavily in Teams, particularly since the early days of the pandemic, when consumers flocked to Zoom because it was easy to download and use from any device. In March 2020, Microsoft said it would allow users to upload custom virtual backgrounds for video calls, a feature that had been available in Zoom for months.

Microsoft CEO Satya Nadella told analysts in July that Teams Phone had almost 80 million monthly active users. At the TechCrunch Disrupt conference last week, Slack CEO Stewart Butterfield said Microsoft has made its intentions pretty clear.

“Over the last year, maybe even 18 months, I think Microsoft’s preoccupation with killing us has shifted somewhat to a preoccupation with killing Zoom,” Butterfield said. Salesforce closed its acquisition of Slack earlier this year.

Microsoft is also releasing Operator Connect, a product it announced in March to let customers draw on their existing services from carriers such as NTT and Verizon to make calls. Zoom supports fast connections to existing landline carriers.

Telecommunications companies work directly with Microsoft, so customers don’t have to launch integration projects on their own, Microsoft corporate vice president Jared Spataro said.

“I’m starting to see this really take off for us in terms of interest,” Spataro said.

Zoom isn’t sitting still, however. The company is using its stock market gains from the pandemic to bulk up beyond cloud-based video and phone calls. In July, Zoom announced its intent to acquire call center technology provider Five9 for $14.7 billion.

Call center agents can already use Zoom Phone with Five9. Now the same thing is possible with Teams Phone.

“I think whenever you have your own — they’re going to pay a lot of money for acquiring their contact-center solution — I think they will of course try to make that fantastic,” Spataro said.

To get Microsoft’s Teams Phone service, organizations with at least 300 users must buy the high-end Office 365 E5 or Microsoft 365 E5 subscriptions. If they have a less expensive subscription, they can add the new features for a fee.

Microsoft said last month that it will increase the cost of Office 365 E5 in March. That will mark the first broad price adjustment since the company introduced the subscription bundle in 2011 as an alternative to traditional licenses.

E5 subscriptions represent 8% of the entire Office 365 commercial installed base, Microsoft CFO Amy Hood told analysts on a conference call in July. The company has over 300 million Office 365 commercial paid seats.

WATCH: Microsoft CEO: Flexibility key to future of hybrid work

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Business

Carnival, Nike, Match and more

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The Carnival Cruise Ship ‘Carnival Vista’ heads out to sea in the Miami harbor entrance known as Government Cut in Miami, Florida June 2, 2018.

RHONA WISE | AFP | Getty Images

Check out the companies making headlines in midday trading.

Carnival — Carnival shares rose 4% after the cruise line said voyages for the third quarter were cash flow positive and expects this to continue. Shares of Norwegian Cruise Line gained 3.2% and Royal Caribbean added 3%.

Match Group — Shares of Match Group rose 3.6% after the online dating platform announced on Thursday that it will sell shares of its common stock in a registered direct offering. The price per share and number of shares of common stock issued will be calculated by a volume-weighted average price during a five-day averaging period starting Friday, the company said.

Merck — Shares of the pharmaceutical giant rose 1.2% on Friday after Merck and AstraZeneca announced that treatment using the drug Lynparza showed positive results in a phase-three trial. The trial results suggest that the treatment slows the progression of prostate cancer and show a trend toward increased survival, the companies said.

Nike — The apparel stock fell more than 6% after Nike cut its full-year guidance for sales growth. The company said supply chain issues in Vietnam were slowing sales. Nike now projects mid-single-digit revenue growth for its 2022 fiscal year, down from prior guidance of low-double-digit growth.

Costco — Shares of the retailer jumped more than 2% following Costco’s fourth-quarter results. The company beat top- and bottom-line estimates during the quarter, earning $3.90 per share excluding items on $62.68 billion in revenue. Analysts surveyed by Refinitiv were expecting $3.57 per share on $61.3 billion in revenue.

Salesforce — Salesforce extended its Thursday gains, rising 2.2% after Piper Sandler upgraded the stock to overweight from neutral, saying it’s confident the company could see “a multi-year period of multiple and profit expansion.” The stock jumped on Thursday after the software company raised its full-year 2022 revenue guidance.

Coinbase — Shares of the cryptocurrency exchange slid about 1.6% even after Needham reiterated the stock as a buy. Cryptocurrencies plunged Friday morning on news that China is issuing yet another crypto crackdown. Coinbase derives 90% of its revenue from retail transactions, which is highly correlated with crypto asset prices, according to Needham, so its stock price tends to move in tandem with cryptocurrencies.

Cheesecake Factory, Dave & Buster’s — Cheesecake Factory and Dave & Buster’s added 4.4% and 5.2%, respectively, after Jefferies upgraded the restaurant stocks to buy from hold. “We are incrementally more positive on the full service category following delta/inflation sell-off and exuberant Consensus forecasts reigned in,” Jefferies said.

Roku — Roku shares fell 3.8% after Wells Fargo downgraded the video streaming platform to equal weight from overweight. Wells Fargo said rising competition makes expectations for Roku’s revenue growth likely too high.

— CNBC’s Jesse Pound, Pippa Stevens and Tanaya Macheel contributed reporting

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Business

Darden Restaurants, BlackBerry, Salesforce and others

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Check out the companies making headlines before the bell:

Darden Restaurants (DRI) — The Olive Garden parent reported earnings of $1.76 per share, higher than the $1.64-per-share forecast. The restaurant company also reported same-store sales that rose 47.5%, topping estimates. Shares rose 3% in premarket trading.

BlackBerry (BB) — The company reported better-than-expected quarterly earnings, with an adjusted gross margin of 65%. BlackBerry reported a loss of 6 cents per share, compared with the expected loss of 7 cents per share, according to Refinitiv. Revenue came in at $175 million, topping estimates of $164 million. Shares rose more than 7% premarket.

Salesforce (CRM) — The software company raised its full-year 2022 revenue guidance to between $26.25 billion and $26.35 billion. This is higher than the company’s previous estimate of revenue between $26.2 billion and $26.3 billion. Analysts expected $26.31 billion. Shares rose 2% in premarket trading.

KB Home (KBH) — Shares of the homebuilder rose in premarket trading despite missing top and bottom-line estimates. KB Home reported quarterly earnings of $1.60 on revenue of $1.47 billion. Wall Street expected earnings of $1.62 per share on revenue of $1.57 billion, according to Refinitiv.

Joby Aviation (JOBY) — Morgan Stanley initiated coverage of the air taxi start-up with an overweight rating, saying in a note to clients on Thursday that investors should take a look at a stock with major potential upside. Shares of Joby Aviation popped more than 5% in extended trading.

Biogen (BIIB) — The drugmaker’s stock rose in premarket trading after Needham initiated coverage of the stock with a buy rating, saying in a note to clients on Wednesday that the company’s controversial Alzheimer’s drug Aduhelm will be a big seller for the company long term.

Roku (ROKU) — Shares of the streaming company rose 2% in premarket trading after Guggenheim upgraded the stocks to buy from neutral. The Wall Street firm assigned Roku a 12-month price target of $395, implying a 22% one-year return.

SoFi (SOFI) — Shares of the fintech company rose in premarket trading after gaining 11% during the regular session on Wednesday. Sofi is the 6th most-mentioned stock on Reddit’s WallStreetBets, according to quiver quant.

Accenture (ACN) — Accenture shares rose in extended trading after reporting better-than-expected earnings. The company also increased its dividend and buyback authorization.

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Business

Stock futures are flat with S&P 500 at fresh record

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A trader works on the floor at the New York Stock Exchange (NYSE) in New York, August 20, 2021.

Andrew Kelly | Reuters

U.S. stock futures were steady in overnight trading on Wednesday following the S&P 500’s rally that saw the index cross the 4,500 level for the first time ever.

Dow futures rose 31 points. S&P 500 futures gained 0.03% and Nasdaq 100 futures were flat.

Shares of software giant Salesforce rose 2% in extended trading after reporting fiscal second-quarter earnings and forward guidance that exceeded analysts’ estimates. Ulta Beauty also rose 6% in after hours trading on strong results.

On Wednesday, the Dow Jones Industrial Average rose 39 points. The S&P 500 gained 0.22% to close at a record, led by stocks that benefit from the economic reopening like airlines, cruise lines and financials. The 500-stock average crossed the 4,500 threshold for the first time ever on Wednesday, but closed below that level.

The Nasdaq Composite rose 0.15%, also notching a record close.

The yield on the benchmark 10-year Treasury note rose as high as 1.352% Wednesday, hitting its highest level since earlier in the month when it yielded as much as 1.364%.

“The 10-year Treasury bond yield has continued rising in recent days and exploded higher in [Wednesday’s] trading, sending a strong message that the Delta variant of Covid may be peaking in the U.S. which should improve confidence, restart economic reopenings, and drive investment flows toward small caps and cyclicals,” said Jim Paulsen, chief investment strategist at the Leuthold Group.

The highly anticipated Jackson Hole symposium starts Thursday. At the event, central bankers could provide updates on their plan around tapering monetary stimulus. The Federal Reserve has been purchasing at least $120 billion of bonds per month to curb longer-term interest rates and jumpstart economic growth in reaction to the pandemic. Chairman Jerome Powell is slated to make remarks on Friday.

“Expect investors to keep an eye on the Fed’s symposium the rest of this week for any comments about tapering or timing for interest rate hikes,” said Paulsen. “Either unexpected commentary from the Fed or a failure or success in scaling 4500 could bring additional volatility to the stock and bond markets.”

Last week’s jobless claim data will be released at 8:30 a.m. ET on Thursday. Economists polled by Dow Jones are expecting 350,000 Americans filed for unemployment last week, compared to the prior week’s 348,000.

Several companies report quarterly earnings on Thursday including Dell Technologies, Gap, HP and Abercrombie & Fitch.

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Business

Intel, GameStop, ViacomCBS & more

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Take a look at some of the biggest movers in the premarket:

Intel (INTC) – Intel said it would spend $20 billion to build two new plants at existing facilities in Arizona, in an effort to grab more market shares and fill gaps created by a worldwide chip shortage. Intel aims to start production at the new plants by 2024. Intel shares rose 4% in premarket trading, while shares of competitor Taiwan Semiconductor (TSM) fell 2.1% following Intel’s announcement.

GameStop (GME) – GameStop reported quarterly earnings of $1.34 per share, missing forecasts by a penny a share. Revenue also came in below consensus. The videogame retailer did not address the Reddit-fueled trading frenzy in its stock during its earnings conference call, but in a Securities and Exchange Commission filing said it was considering the idea of raising money by selling shares to fund its ongoing transformation. The stock tumbled 12% in premarket trading.

ViacomCBS (VIAC) – The media company’s shares fell another 7% in the premarket after sinking 9.1% Tuesday on news of a $3 billion stock offering.

General Mills (GIS) – The food producer fell 2 cents a share shy of Wall Street forecasts, with quarterly earnings of 82 cents per share. Revenue exceeded estimates and General Mills said expects demand for food at home to remain elevated relative to pre-pandemic levels. Its shares were down 1.9% in the premarket.

Winnebago (WGO) – The company’s shares gained 3.7% in premarket action after the recreational vehicle maker reported quarterly profit of $2.12 per share, compared to a $1.42 a share consensus estimate. Revenue topped analysts’ forecasts and Winnebago saw a nearly 6 percentage point expansion in gross margins during the quarter.

Adobe (ADBE) – Adobe beat estimates by 35 cents a share, with quarterly profit of $3.14 per share. The software company’s revenue came in above estimates as well and Adobe issued strong current-quarter and full-year earnings guidance on strength in its flagship Creative Cloud suite and other cloud-based offerings. Adobe rose 1.2% in premarket action.

Amazon.com (AMZN) – Amazon named Adam Selipsky as CEO of its Amazon Web Services unit, effective when current chief Andy Jassy replaces Jeff Bezos as Amazon CEO later this year. Selipsky had been an executive at Amazon Web Services to become CEO of Tableau Software, which has since been acquired by Salesforce.com (CRM). Amazon rose 1% in premarket trading.

Bank of New York Mellon (BK) – The bank’s shares climbed 1.3% in the premarket following a double upgrade from Bank of America Securities to “buy” from “underperform.” BofA said its call is based on attractive valuation as well as an improving profit outlook.

Exxon Mobil (XOM) – Exxon Mobil’s debt ratings were downgraded by rating agency Moody’s to Aa2 from Aa1, pointing to the energy giant’s aim to maintain its dividend. Moody’s said that policy will slow debt reduction at Exxon Mobil.

AMC Entertainment (AMC) – AMC shares fell another 2.1% in premarket trading following Walt Disney’s (DIS) announcement that it would delay the release of its “Black Widow” movie by two months, and offer it simultaneously in theaters and on its Disney+ service for a fee. The movie theater operator’s shares had plummeted 14.7% yesterday and 10.3% on Monday.

Steelcase (SCS) – Steelcase earned 6 cents per share for its latest quarter, compared to a consensus estimate of a 1 cent per share loss. The office furniture maker’s revenue came in above forecasts as well. The company gave a weaker-than-expected forecast, however, as demand for office products continues to be weak. Its shares lost 3.4% in the premarket.

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Business

Okta is buying security rival Auth0 for $6.5 billion, stock falls

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Okta CEO Todd McKinnon

Okta

Okta, whose cloud software allows office workers to access all of their apps through a secure online service, said on Wednesday that it’s spending $6.5 billion to acquire rival Auth0.

Okta’s shares plunged about 13% in extended trading after the announcement. The all-stock deal equals about 21% of Okta’s market cap as of Wednesday’s close. Okta said it expects the transaction to close by the end of July.

With more large businesses counting on cloud-based applications, Okta has seen its revenue surge since its 2017 IPO. The company said in its earnings statement on Wednesday that fourth-quarter revenue jumped 40% to $234.7 million. Its net loss widened to $75.8 million from $50.4 million a year earlier.

Auth0 last raised private capital in July at a $1.92 billion valuation. Salesforce Ventures led the round, more than tripling its money in eight months.

Okta co-founder and CEO Todd McKinnon was previously a vice president at Salesforce, working under Marc Benioff for over five years. McKinnon is now taking a page from Benioff’s playbook, paying up for acquisitions while still focusing on internal growth.

Salesforce has been the biggest software acquirer in the last few years, agreeing in December to buy Slack for $27.7 billion. Prior to that, Salesforce bought Tableau for $15.3 billion in 2019 and MuleSoft for $6.5 billion a year earlier.

McKinnon wrote in a blog post that Auth0 will continue to operate independently. He said Auth0 CEO Eugenio Pace for years, calling him “an enthusiastic ally in establishing identity as a primary cloud.” 

“Both Eugenio and I have devoted our careers to identity because we know that selecting an identity platform is one of the most critical technology investments an organization can make.” McKinnon wrote.  

This is breaking news. Please refresh for updates.

WATCH: Salesforce’s $27.7 billion deal for Slack

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Business

Cramer on buying growth stocks after inflation scare shakes up market

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CNBC’s Jim Cramer advised that market players have two ways to approach high-flying growth stocks that teetered and tottered their way through a volatile session on Wall Street Tuesday.

Investors can choose to join in on the sell-off that has dropped some tech names like Apple into negative trading territory this year.

The other choice — taking a cue from Federal Reserve Chair Jerome Powell’s restated commitment to leave interest rates at low levels — is to hold on for the ride and consider loading up on worthy stocks discounted from their highs, Cramer said after the market closed mixed.

“After today’s late afternoon rebound, it’s not too late to sell the more egregiously expensive stocks if you want to,” the “Mad Money” host said. “But as for the better growth stocks, down more than 10% from their highs, call me a buyer. Not all at once, not big, but a buyer nonetheless in any retest of that 9:47 a.m. low that we saw today.”

Cramer’s assessment of the current state of the market follows a roller-coaster trading day where major U.S. averages bounced from their session lows. The market suffered a steep sell-off in the morning, with the Nasdaq Composite down almost 4% at its trough, before the blue-chip Dow Jones and benchmark S&P 500 managed to etch out modest gains at the close.

The Dow advanced more than 15 points to 31,537.35 for a 0.05% gain. The S&P 500 finished 0.13% higher at 3,881.37 to end its losing streak at five. The tech-heavy Nasdaq could not muster enough for a positive day, falling 0.5% to 13,465.20, extending Monday’s losses.

“I’m happy to entertain the idea that you need to ring the register here, but I happen to like growth stocks in a reflation scare. I like growth stocks when risk is on. I like growth stocks when risk is off,” Cramer said.

“If you want to hold on to the growth stocks … you have to be prepared to take some pain, just like in late 2015 and early 2016 — that was the last great moment to buy these stocks — or you can just do some selling if you want to and try to swap back in at a lower level,” he added.

The market has toiled through a rotation as investors swap growth and tech stocks that outperformed throughout the pandemic for value plays of companies that are expected to see business return as the economy reopens. The Nasdaq is now 4.5% off its closing high earlier this month.

Worries that an inflation revival could trigger the Fed to raise interest rates, as it did in twice in a three-month span between 2015 and 2016, shook investors out of growth stocks in recent days, Cramer said. Higher rates pose a challenge to growth and utilities stocks.

Share prices in Apple, Salesforce, and ServiceNow are all down at least 3% this week.

During an appearance before Congress Tuesday, however, Powell told lawmakers that inflation remains “soft,” the labor market faces ongoing challenges and that the central bank was committed to its current monetary policy.

That reassured investors about interest rates, helping the market recover some losses.

“This time our Fed chief has vowed to hold off on raising rates — too many unemployed — but there will come a time and a point where these growth stocks will be somewhat hopeless,” Cramer said. “They’ll kind of look like they did today … before people came in to buy.”

Correction: This story has been updated to reflect the correct number of points the Dow advanced by.

Disclosure Cramer’s charitable trust owns shares of Apple and Salesforce.

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