As the investment landscape evolves, the emergence of new technologies and market demands shifts analyst perspectives. Needham & Company has recently unveiled its Top Picks list for 2025, confidently spotlighting two titans: Roku (NASDAQ: ROKU) and Salesforce.com (NYSE: CRM). This selection reflects a calculated assessment of these companies’ growth potential in their respective sectors, particularly in connected television and enterprise software solutions.
Roku, a prominent player in streaming via connected TVs, is forecasted by Needham to experience substantial growth. With an anticipated installed base nearing 100 million homes—translating to approximately 200 million viewers—Roku is strategically positioned to reap benefits from the burgeoning connected TV ad revenue market. Useful data from eMarketer highlights that these revenues are expected to grow by 16% year-on-year, culminating in a staggering $33 billion in 2025.
The uniqueness of Roku lies in its specialization; the company derives all its ad revenues from the CTV segment, marking it as a pivotal player in this rapidly expanding sector. Analysts assert that Roku’s first-party data constitutes an underappreciated asset. As demand increases for qualitative data in advertising campaigns, Roku can monetize this resource more effectively. The assertion that “LLMs will pay ever more for large permissioned data sets” reflects broader trends of data value in digital marketing, suggesting that Roku could greatly benefit from this demand surge.
On the enterprise software front, Salesforce.com has strategically deployed its new Agentforce (AF) framework, also drawing the attention of Needham’s analysts. Their positive outlook stems from preliminary ecosystem checks, indicating that AF is increasingly integrated into a notable share of enterprise customer deals—nearly 50%. These initial engagements might start modestly, but analysts predict significant scaling over the latter half of the year, suggesting a robust growth trajectory.
Salesforce’s current valuation stands at 24 times the projected free cash flow for fiscal year 2026, which, if combined with its ambitious hiring for AI-focused sales representatives, could lead to substantial booking growth. This combination positions Salesforce to not only maintain relevance but also expand its influence in the competitive software landscape. The increased price target proposed by Needham, adjusted to $400 for CRM, speaks volumes about the firm’s confidence in Salesforce’s capability to execute its vision effectively.
Both Roku and Salesforce dot the landscape of Needham’s investment outlook as significant opportunities. However, potential investors should also weigh inherent risks involving market competition and execution challenges. Roku must navigate the dynamic digital advertising space adeptly, while Salesforce’s success hinges on the effective integration of its new strategies amidst rapid market changes.
Ultimately, as we approach 2025, these companies represent a duality of prospects in two contrasting sectors—entertainment and enterprise. Their respective approaches to innovation and strategic growth will be key determinants in realizing their potential as leaders in their fields.