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Salesforce.com, Inc. (CRM - Free Report) and International Business Machines Corporation (IBM - Free Report) on Monday announced a new partnership that will help advance both companies through the integration of Salesforces new artificial intelligence technology with IBMs Watson AI.

Following the announcement yesterday, Salesforce stock is up 0.87% to $83.22 per share through early afternoon trading on Tuesday. Salesforce is currently a Zacks Rank #3 (HOLD). IBM stock is currently up 0.02% to $180.52 per share and is a Zacks Rank #3 (HOLD).

San Francisco-based Salesforce, one of the largest customer relationship management companies in the world, has been at the forefront of cloud computing for years. And it recently announced its new Einstein AI is now available to all of its customers across sales, service, marketing and commerce as well as others.

AI Partnership

Salesforce will use its Einstein AI in its next generation of CRM apps. Einstein is designed to analyze and understand information and data collected from Salesforce customers.

The CRM giant also announced a new set of APIs called Einstein Vision that will allow less tech-savvy developers the ability to build AI-powered apps quickly. "With Einstein, we are democratizing AI, enabling everyone to achieve new levels of productivity and accelerate growth, directly within the products they use every day," Alex Dayon, President and Chief Product Officer of Salesforce, said in a press release.

Salesforce helps manage its customers relationship with their clients to drive sales growth, so Einstein is sales-oriented AI. IBMs Watson AI utilizes human-like conversation skills and hyper learning capabilities to help clients understand, reason, learn and interact.

Marc Benioff, the CEO of Salesforce, was interviewed by CNBC's "Closing Bell" on Monday about the new IBM partnership. Benioff gave an example of how a Salesforce client that makes elevators and escalators could be helped by the new Einstein and Watson partnership. Einstein and Watson would work collaboratively to help the customers.

Watson would be able to determine if maintenance was required on an elevator. Then, Einstein would be able to quickly send the companys maintenance team to the location in a seamless transition of workflow.

Looking Forward

IBM has been at the forefront of the computer industry since its inception. And its stock made its first massive jump in the 1990s. It then dipped in the 2000s. After a down turn in the mid 2000s, IBM stock went from roughly $84 per share in 2008 to an all-time high of $213 per share in March 2013. One of the biggest gains came after IBM first introduced its Watson AI to the world.

Watson first beat two long-time Jeopardy champions in 2011. Since then, much of IBMs business has been focused on the promotion of cloud computing and its AI technology. Many companies in health care, financial services and the automobile industry utilize Watson.

IBM and Salesforce did not enter into a revenue sharing partnership. By working together, the deal hopes to increase the power, scope and consumer reach for both Watson and Einstein separately.

As of May 2016, Salesforce had a market capitalization of roughly $52 billion. The company recently acquired some companies as it continues to try to grow and expand its reach. But the company doesnt have any new acquisitions on its horizon. "We picked up some great companies last year because the acquisition window was really open," Benioff told CNBC on Monday.

"But the reality is, because the market is roaring, the acquisition window is really narrowed, and I just don't see any acquisitions in the short-term."

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IBM and Salesforce Partner to Expand AI and Cloud Computing Platforms - Zacks.com