SAN FRANCISCO, March 10, 2026, 09:32 PDT
- Moody’s downgraded Salesforce to A2, citing the company’s anticipated debt-financed share repurchases. S&P, though, maintained its A+ rating but shifted its outlook to negative.
- Salesforce is lining up a bond offering that could reach $25 billion, Bloomberg reported, with proceeds earmarked for buybacks.
- Salesforce dropped $2.61 to $196.18 as of Tuesday morning.
Salesforce found itself under renewed credit pressure Tuesday as Moody’s lowered its rating to A2—still within investment grade, but a notch down. S&P Global Ratings kept its A+ rating in place, though it shifted the outlook to negative. Shares slipped $2.61 to $196.18 during morning trade.
Salesforce is facing new scrutiny less than two weeks after rolling out an ambitious payout strategy. According to Bloomberg, the company is lining up a potential $25 billion debt offering to bankroll share buybacks—a move that could prop up the stock but may also push its borrowing risk higher.
On Feb. 25, Salesforce announced a fresh $50 billion share repurchase program, scrapping any unused buyback approvals from before. The board also bumped its quarterly dividend by 5.8%, now set at 44 cents a share. For fiscal 2026, Salesforce returned $14.3 billion to shareholders—$12.7 billion of that was buybacks—as it posted a 10% jump in full-year revenue to $41.5 billion.
All this unfolded as software stocks tumbled. The S&P 500 software index has dropped 28% since late October, according to Reuters. U.S.-listed software firms have rolled out $70.5 billion in buybacks since Jan. 12, with ServiceNow tossing another $5 billion onto its pile. Andrew Slimmon at Morgan Stanley Investment Management described the moves as “an attempt to stop the decline.” Still, Peter Tuz at Chase Investment Counsel wasn’t convinced, saying, “I don’t think the buybacks are enough.” Reuters
It’s not just Salesforce on edge. Workday shares slumped to their lowest point in over five years last month after the company’s downbeat outlook stoked concerns that newer AI offerings might undercut established software models—a cue that’s rippling through the entire sector.
Salesforce faces a key test: Can its AI agents — tools designed to handle tasks with minimal human help — break out of pilot phases and get picked up more broadly by big companies? “Against the backdrop of concerns about AI eating software-as-a-service, Salesforce needs to show it is continuing to translate early AI traction into broader enterprise adoption,” said Rebecca Wettemann, chief executive at Valoir. Reuters
S&P pointed out Salesforce still has capacity for major buybacks, though it expects leverage to increase. The agency put debt to EBITDA at roughly 0.6x as of Jan. 31, 2026. Moody’s, citing its own action, highlighted leverage and potential risks to the balance sheet as the main issues.
Management continues to pitch the buyback as a show of faith in the company. Marc Benioff told investors Salesforce was “well on our way” to hitting $63 billion in revenue by fiscal 2030. Robin Washington pointed to the bigger authorization, saying it signals a “strong trajectory” and backs up shareholder value. Bloomberg.com
The risk is hard to miss. Should Salesforce fall short on the organic revenue growth it’s promising for the latter half of fiscal 2027, leaning on debt to fund buybacks probably won’t shift entrenched investor doubts about AI threatening traditional software businesses. Reuters pointed out that Salesforce’s most recent annual revenue guidance landed just under what Wall Street had penciled in.
