Salesforce borrows $25B for buyback; debt raises concern

Salesforce borrowed $25 billion to fund an accelerated share repurchase after reporting first-quarter results on May 27, 2026. The financing followed a revenue beat and prompted analysts to trim targets while highlighting higher interest costs and lower free cash flow guidance.

The company reported $11.1 billion in revenue for the quarter, up 13% year over year. Adjusted earnings per share were $3.88 versus a $3.12 estimate, and adjusted operating margin was 34.8%. For the current quarter, management guided revenue of $11.27 billion to $11.35 billion versus a consensus of $11.36 billion, and adjusted EPS of $3.25 to $3.27.

Salesforce used the $25 billion borrowing to execute an accelerated share repurchase. Including the regular dividend, the company returned about $27.5 billion to shareholders in the quarter. Quarterly interest expense rose to $317 million from $68 million a year earlier, an increase of about $249 million. Company filings describe the added interest as a permanent drag on cash flow. Management lowered full-year free cash flow growth guidance to 4% to 5%, down from 9% to 10%.

Barclays reduced its price target to $236 from $252 and kept a buy rating. Jefferies maintained a $250 target. Options-market activity shifted toward downside protection: the put-call volume ratio moved from 0.33 on May 18 to about 0.76 by May 27, and open interest on puts increased.

Salesforce reported growth in its AI-related products. Agentforce and Data 360 annual recurring revenue reached $3.4 billion, up more than 200% year over year. Agentforce processed 28.6 trillion tokens, up 152% quarter over quarter, and generated 3.8 billion Agentic Work Units, up 111% quarter over quarter. Public sector ARR exceeded $2 billion, up 23% year over year. Slack’s Model Context Protocol reached one million active users within six weeks of launch.

The legacy SaaS business, labeled Agentforce Apps, grew about 7% in constant currency. Excluding a $444 million contribution from the recent Informatica acquisition, organic growth was approximately 8.7%. Management noted the Informatica deal helped bolster ARR and subscription revenue.

On the market, Salesforce shares traded near $177.51 and tested the upper trendline of a falling price channel in place since January. Technical indicators showed the 20-day exponential moving average around $178.35 and channel resistance near $183.80. Sell volume increased in several recent sessions.

CEO Marc Benioff wrote that Agentic Work Units measure autonomous AI actions performed for customers rather than software seats. Company executives described the strategy as the ‘Agentic Enterprise’ and emphasized AI consumption while the added debt shifted investor attention to cash flow growth and interest costs.