Microsoft Corp. today announced that its board of directors approved a new share repurchase program authorizing up to an additional $40 billion in share repurchases with an expiration of September 30, 2013.
The board of directors also declared a quarterly dividend of $0.13 per share, reflecting a two cent or 18 percent increase over the previous quarter’s dividend. The dividend is payable December 11, 2008 to shareholders of record on November 20, 2008. The ex-dividend date will be November 18, 2008.
In addition, the company stated that it has completed its previous $40 billion stock repurchase program. Microsoft has returned over $115 billion to shareholders through a combination of share repurchases and dividends over the last five years.
“These announcements illustrate our confidence in the long-term growth of the company and our commitment to returning capital to our shareholders,” said Chris Liddell, chief financial officer of Microsoft, in the press release.
Microsoft also announced that its board of directors has authorized debt financings from time to time of up to $6 billion. Pursuant to the authorization, the company has established a $2 billion commercial paper program. Microsoft intends to use the net proceeds from any debt financings for general corporate purposes, which may include funding for working capital and repurchases of stock.
The company received corporate credit ratings of AAA and Aaa by Standard & Poor’s Rating Services and Moody’s Investors Service Inc., respectively. The commercial paper is rated A-1+ by Standard & Poor’s and P-1 by Moody’s, the highest ratings available from both agencies.
“The company’s strong credit quality coupled with investors’ current appetite for high quality paper provides a unique opportunity for the company to establish its first-ever commercial paper program and enhance its capital structure,” said George Zinn, treasurer of Microsoft, in the press release.
Source: Microsoft Corporation
Fighting with Windows here, but it pays the bills.
Don’t change Microsoft!
I love your incompetence!!
If they are using that Windows VISTA turd, they could use some “high quality paper” to handle the mess!
It’s what you do after the Yahoo buyout fails and you have no strategy for the money you make from your illegal monopoly.
“It’s what you do after the Yahoo buyout fails and you have no strategy for the money you make from your illegal monopoly.”
Yep.
What does this have to do with Mac Daily News? Now if you want us to flame MSFT, then just say so!
Companies should be banned from buying their own stock on the grounds that it is manipulating the stock price.
Let the market determine a fair market price.
(I know, kinda bold thing to say these days).
If you have extra cash, and no good ideas (Microsoft? ideas?), give a dividend, don’t try and game the stock price.
So that’s how gates and balmer sell their stock. I always thought buy-backs were for companies in financial trouble.
So they’re giving the money back to the shareholders? Well, they just forgot step one… close down the company. But it’s a step in the right direction. 😀
Buy backs are for companies who are betting that their stock will increase in value after this market debacle.
Sure Am Relieved writes, “Companies should be banned from buying their own stock price on the grounds that it is manipulating the stock price.” Nonsense. Stocks are issued to raise money for corporate purposes. Stock buybacks increase the stake shareholders have in the enterprise.
Buybacks are often a rational option when there is no better use for those funds. Given Microsoft’s struggle to come up with another winner is going nowhere, and the lack of payoff from its current investments, this may be the right course for them.
Illegal monopoly or not, it’s great to see them fail all by themselves, without any help from regulators.
That’s innovative.
These announcements illustrate our confidence in the long-term growth of the company
?!?!?
When you’re confident in growth you SPLIT stock.
When you’re grasping at straws to prevent a revolt, you buy back stock.
I wonder if they want to buy back our old junk beige boxes?
Companies do stock Buy backs for a number of reasons.
The end result is they are looking to boast the stock value and in the end the stock price. Microsoft’s stock price has been for the most part flat for years and years. They may never repurchase even one share. In their last stock buy back round they never really bought back much. But the announcement is a way to try and spike the price and create interest. It’s just a shell game.
Microsoft has returned over $115 billion to shareholders through a combination of share repurchases and dividends over the last five years.
And their stock STILL flatlined! $115 billion, OMG!!
Check the graphs, MSFT is worth less today than in 2003. And that’s not even inflation-adjusted.
Keep buying back the stock, Ballmy. Someone needs to be stuck with it.
The problem with Microsoft is that there is no where to go. Their market share is up for grabs. Other than that, they just suck.
@confused (and others)
It is worth remembering the relatively obvious fact that Microsoft will not lose $40 billion, it will simply buy $40 billion worth of Microsoft stock. If Microsoft stock goes up, they’ve made a profit. So the buy-back, in theory, displays the confidence they have that the company is doing well; the company’s stock will in fact go up. They’re probably wrong, but it almost certainly won’t be a 100% $40 billion loss.
The “wow” starts now.
As most of us have money in MSFT, like it or not, through our retirement plans, etc., this is good news.
Gates found some coins stuck in the couch this morning. I wish Apple would do this.
40 billion.
what can i say as an apple stockholder? please apple only one time in history follow microsoft and do the same! buy back the stock in times like these to protect your shareholders and start to pay a fucking dividend. you don’t need 20 bn on the bank to be prepared for bad times.
“you don’t need 20 bn on the bank to be prepared for bad times.”
When your up against a monopoly that has been approved by the Gov to continue to operate, yes you need as much as possible in the bank.
MS can keep feeding money to their crappy money losing products like Zune and store.. eventually to wear down Apple as the Zune hardware software catches up….. Its gonna happen, sorry to say, but each year they keep getting closer and closer. MS is already heading to take over the gaming market.
ignore the fact this is microsft for a minute
they are effectively pumping $40 billion into the US financial system by doing this, sure it might be over a period of time but in the current climate this is good news, it also has propped up the share price on a bad day for the market, shares that as has already been mentioned you all probably hold through your pension schemes
every bit of news doesnt need to be seen in a microsoft v apple light, look at whats best for you and the population as a whole
theloniousMac: “Gates found some coins stuck in the couch this morning. I wish Apple would do this.
40 billion.”
If you think you can spend whatever money you have invested in Apple stock better than they can, then sell your stock and do so.
If you want dividends and stock buy back from a no-growth stock, there’s plenty of shares of MS stock for sale.
Apple is using the capital they get from selling wildly hot products to re-invest in their business and grow in multiple markets at an unprecedented pace. I don’t see how a stock buy back or dividends can help Apple and I doubt they would do it.