Salesforce Drops $27 Billion on Stock Buybacks Amid AI Growth Bets

Salesforce CEO Marc Benioff is betting big on his company's future, investing a record $27 billion in stock repurchases in a single quarter. This move comes as Salesforce shares remain down over 25% year to date through mid-August, with the stock hitting a multiyear low of $146.32 in June before recovering modestly.

Benioff has framed this decision as a direct rebuttal to what he calls the 'SaaSpocalypse', the brutal sectorwide sell-off that has punished software-as-a-service companies throughout 2026. He is effectively arguing that the cost of equity is far higher than the company's current valuation, which implies years of sluggish revenue growth.

Salesforce's decision to load up on debt to fund this repurchase reflects a calculated bet on the company's valuation. The bonds issued carry interest rates ranging from 4.5% to 6.7%, but management believes the cost of equity is even higher, making the stock undervalued relative to its growth prospects.

The company's financial results have been strong, with record revenue of $11.1 billion in its fiscal first quarter ended April 30, up 13% year over year. This has prompted management to raise its full-year revenue forecast to a range of $45.9 billion to $46.2 billion.

AI offerings like Agentforce and Data 360 are driving much of the optimism, with combined annualized recurring revenue doubling year over year in the latest quarter. Customer usage of Salesforce's agentic AI has exploded, with clients tapping the technology 1.6 billion times in the first quarter, compared to just 14 million times two years earlier.

Some Wall Street analysts are beginning to recalibrate their views, with Citigroup raising its price target on Salesforce to $204 from $187 on August 18. This follows comments from Goldman Sachs CEO David Solomon, who suggested the SaaSpocalypse sell-off went overboard.