Salesforce's $25 Billion Buyback Leaves a Heavy Debt Load

Salesforce's massive $25 billion accelerated share buyback program has significantly altered its balance sheet, and it's not just about the reduced share count. The company's diluted share count fell by approximately 15% from 962 million to 821 million in a year, following the completion of the buyback.

The financing for this massive repurchase came at a cost, Salesforce's total debt skyrocketed from $11.81 billion to $42.38 billion over the same period. This increase in debt has resulted in a significant drag on the company's fiscal 2027 free cash flow growth outlook, which was revised down from 9% to 10% to just 4% to 5%

Salesforce's President and Chief Operating and Financial Officer, Robin Washington, stated that the program should retire at least 14% of shares outstanding at an expected average price near $182. The final share delivery in October will reveal exactly how much of the company was bought back.