What happened
Salesforce borrowed about $25 billion to buy back its own stock. The move retires roughly 10% of shares in one go. The new debt and buyback are expected to show up in fiscal 2027 cash flow. At the same time, management cut its cash flow growth guidance in half, signaling a slower path for cash generation.
Why it matters
Financing a big buyback with debt changes the company’s balance sheet. It can lift per-share metrics in the short term, but it raises interest costs and leverage. Cash that would have funded growth projects or new products is instead used for returns to shareholders. The halved cash-flow growth guidance adds a note of caution about how fast the company can expand cash flow going forward.
What to watch
Watch Salesforce’s debt level and interest expense in future results. See whether the company continues to buy back stock or slows down after this large move. Look for updates to cash flow guidance and any changes to capital plans, like investments or acquisitions. Also monitor how the market reacts to the new leverage and the stock’s price trajectory.