Salesforce Spent $25 Billion Buying Back Stock. Three Days Later, Nobody Knows What to Think

Salesforce just spent twenty-five billion dollars buying back its own stock.

Three trading sessions later, the stock is almost exactly where it started.

Up 3% on the announcement. Down 3.24% the next day. Up 2.6% today.

That chop — on the largest buyback in company history — is the story.

Let me tell you why.

The announcement came Thursday, March 12. CRM launched a twenty-five billion dollar accelerated share repurchase — the largest in company history.

The first half of a fifty-billion dollar total buyback authorization. Five of the biggest banks on Wall Street brought in to execute it. Sounds like a massive vote of confidence, right?

The stock jumped 3% that day.

Then the market had twenty-four hours to think about it.

On March 13, CRM fell 3.24%. It gave back the entire gain and then some. And today it bounced 2.6%.

Three sessions. Three different directions. Net result: basically unchanged.

Here's what that tells me.

To fund this buyback, Salesforce issued twenty-five billion dollars in corporate debt. Eight tranches. Maturities stretching from 2028 all the way out to 2066.

They issued forty-year bonds to buy back stock today. And the bond market told you exactly what it thought — the ten-year tranche priced at 1.35 percentage points over Treasuries, significantly wider than where Salesforce issued debt in 2021.

When your own bond buyers demand more premium than they used to, that's the market saying: this company carries more risk than it did.

Now layer in the business context. Salesforce's organic revenue growth came in at 8% last quarter — and analysts are forecasting it slows further to 7-8% this year.

The SaaS model that built this company is being disrupted by AI almost overnight. Their stock is already down twenty-two percent year to date.

So the question the market is asking is exactly the one I would ask:

why are you issuing forty-year debt to buy back shares when your core business might need that capital to reinvent itself?

That is not a bullish question. That is a defensive one.

Two to three months ago, a fifty-billion dollar buyback authorization from one of the world's biggest software companies would have sent this stock up four or five percent. Minimum. Institutions would have read it as management saying the stock is deeply undervalued and piled in.

Instead we got three days of noise. Up, down, up. The market can't commit.

And that indecision is information.

This is exactly what the expected move framework shows you. CRM has been channeling — bouncing between the upper and lower edge of its expected move, refusing to break in either direction. A twenty-five billion dollar buyback didn't change that.

The market absorbed the news, argued with itself for three sessions, and ended up right back where it started.

That's not a bullish stock. That's a stock waiting for a reason to move that a buyback announcement can't provide.

Watch the levels this week. If CRM can clear and hold above the expected move upper edge, the bulls have a case. If it fades back into the channel, the market has made its verdict.

The buyback told you what management thinks of the stock.

Three days of price action told you what the market thinks of the buyback.

I know which one I trust.

To your success,

Don Kaufman

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Salesforce Spent $25 Billion Buying Back Stock. Three Days Later, Nobody Knows What to Think

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