Here's a bold move: Salesforce Inc. (CRM) just decided to spend $25 billion buying its own stock. Not over a decade. Not even over a few years. Right now. The company initiated a massive accelerated share repurchase (ASR) program on Monday, and it's not just big—it's the largest ASR transaction in corporate history.
Think about that for a second. The company's total market cap is about $184 billion. This buyback represents roughly 13% of the existing shares floating out there. It's also exactly half of the $50 billion total repurchase authority the company's board granted back in February. They're not dipping a toe in the water; they're doing a cannonball.
So, what's an ASR? In simple terms, it's a way for a company to buy back a huge chunk of its shares all at once, through a deal with investment banks. Salesforce has already started the process, with an initial delivery of about 103 million shares today, covering roughly 80% of the total shares expected under the agreement.
Why would a company do this? Well, it's a massive vote of confidence. "We are aggressively repurchasing shares because we are so confident in the future of Salesforce," said Marc Benioff, the company's Chair and CEO. It's the corporate equivalent of putting your money where your mouth is.
Robin Washington, Salesforce's President and Chief Operating and Financial Officer, echoed that sentiment, saying the move reflects "increased conviction in the durability of our growth." This aggressive pivot toward returning capital to shareholders comes on the heels of a strong fourth-quarter performance. The company reported revenue of $11.2 billion, beating estimates, and adjusted earnings of $3.81 per share, which crushed the $3.04 consensus.
But $25 billion doesn't just appear out of thin air. To fund this historic buyback, Salesforce went to the debt markets. Just last week, on March 12, the company priced a $25 billion public offering of senior notes. It's essentially borrowing money to buy its own stock—a move that makes sense if you believe your stock is undervalued and your future cash flows are solid enough to cover the new debt.
Major banks are involved in making this ASR happen, including JPMorgan Chase Bank (JPM), Bank of America (BAC), and Citibank (C). The backdrop here is also interesting. Salesforce is leaning into its "Agentforce" AI momentum, and there have been reports that Nvidia Corp (NVDA) has approached the company about potential partnerships for its NemoClaw AI platform. It's a time of strategic focus and, apparently, financial confidence.
As for the mechanics, the final settlement for this ASR is expected in the third or fourth quarter of fiscal 2027. The exact number of shares Salesforce ultimately retires will depend on the company's volume-weighted average stock price during the term of the agreement. If the stock goes up, they get fewer shares for their $25 billion. If it stays lower, they get more.
The market's initial reaction? Positive. Salesforce shares were up 1.78% at $196.26 at the time of publication on Monday. When a company bets this big on itself, investors often take notice.
