Salesforce Bets the Balance Sheet on a $50 Billion Buyback — And Rating Agencies Aren't Impressed

The credit agencies weigh in — and they're not enthusiastic

The rating agency reaction was swift. Moody's downgraded Salesforce from A1 to A2, citing the company's anticipated debt-financed repurchases. S&P Global maintained its A+ rating but shifted the outlook to "negative" — a signal that a downgrade could follow. [3] S&P's analysts didn't mince words. "Although we expect EBITDA will expand and believe Salesforce has strong cash-flow generation to fund some shareholder returns, aggressive buybacks — coupled with acquisitions — could keep leverage elevated longer than expected," they wrote ahead of the official pricing. [1] In a follow-up report on Wednesday, S&P noted that the negative outlook "reflects the potential for Salesforce's leverage to double within the next two years." The analysts assigned an A+ rating to the offering itself, "because the company has some debt capacity at the rating," but the warning was clear: Salesforce is spending faster than it's growing. [1] Both Moody's and S&P also flagged something more fundamental than balance sheet math. They cited uncertainty about Salesforce's "business trajectory over the longer term" and questioned "how widely or how quickly artificial-intelligence offerings will be adopted in enterprise settings." [1][3] That's the real concern buried in the credit reports. It's not just about leverage ratios. It's about whether the product Salesforce is selling will still be essential in five years.

The AI disruption question

Salesforce's stock has been under sustained pressure, and the reason isn't complicated. Investors are worried that AI — specifically the kind of agentic AI that can handle customer interactions, manage pipelines, and automate workflows — will reduce demand for traditional CRM software. [1][2] The irony is that Salesforce has its own answer to this: Agentforce, an AI platform designed to let companies deploy autonomous agents within the Salesforce ecosystem. Benioff has been pushing Agentforce hard, positioning it as the company's path to AI-native revenue growth. But the numbers haven't caught up to the narrative yet. And in the meantime, the stock is down 26% year-to-date, making Salesforce one of the worst performers among large-cap enterprise software companies in 2026. [2] This is where the buyback decision gets interesting. If Benioff is right — if Agentforce takes off, if AI adoption strengthens rather than cannibalizes CRM demand, and if the stock is genuinely undervalued — then borrowing $25 billion at investment-grade rates to buy back shares at a 50% discount from peak is a masterstroke. Shareholders who held through the dip will be rewarded with higher earnings per share and a recovering stock price. But if Benioff is wrong — if AI disruption accelerates, if customers start migrating away from traditional SaaS toward AI-native alternatives, and if revenue growth decelerates — then Salesforce will have loaded its balance sheet with $25 billion in debt to prop up a declining asset. That's not confidence. That's financial engineering on borrowed time.

The M&A debate

The capital allocation question gets sharper when you consider the alternative. D.A. Davidson analyst Gil Luria raised the obvious counterpoint after the February earnings report: "We question if this is the optimal use of capital given the potential shareholder value that could be unlocked through strategic M&A at current valuations." [1] He has a point. Enterprise software valuations are broadly depressed right now. Companies that Salesforce might want to acquire — AI-native startups, vertical SaaS platforms, data infrastructure providers — are trading at multiples Salesforce couldn't have dreamed of two years ago. The same market conditions that make Salesforce's stock look cheap make potential acquisition targets cheap too. Salesforce has historically been an aggressive acquirer. Slack ($27.7 billion), Tableau ($15.7 billion), and MuleSoft ($6.5 billion) were all massive bets on expanding the platform's reach. But Benioff signaled a shift on the earnings call, saying the company now has "a much better understanding of how to do acquisitions that are accretive to the business but not dilutive to investors." [1] Translation: Salesforce is done overpaying for deals. The company returned substantially all of its fiscal Q4 free cash flow to shareholders. The new strategy is buybacks first, selective acquisitions second. [1] Whether that's disciplined capital allocation or a failure of strategic imagination depends entirely on whether you believe Salesforce's organic product road map is strong enough to navigate the AI transition alone.

What this actually signals

Strip away the financial mechanics and the rating agency reports, and here's what Salesforce just told the market: We think our stock is worth dramatically more than its current price, and we're willing to take on significant debt to prove it. That's either supreme confidence from a management team that sees an AI-native future for its platform — or it's a defensive move from a company that can't find better uses for $25 billion than giving it back to shareholders at a discount. The honest answer is probably somewhere in between. Benioff has earned some benefit of the doubt — he built Salesforce from a cloud CRM startup into a $179 billion company. But the enterprise software market is shifting faster than at any point since the cloud transition, and this time the disruption isn't coming from a better version of the same product. It's coming from AI systems that might replace the product category entirely. Salesforce has two years to prove the credit agencies wrong. After that, the debt comes due and the leverage ratios tell the story. Either Agentforce delivers and the stock recovers, or Salesforce spent $25 billion buying a peak that already passed. The bond market will be watching. So will every enterprise software CEO who's wondering whether their company should be buying back stock or building for what comes next.