Dive Brief:
- Microsoft announced Tuesday it had authorized a $40 billion share buyback program.
- At the end of trading Tuesday, Microsoft had market value of about $440 billion, which means the company is buying back a little over 9% of the outstanding shares.
- Microsoft said it will complete the first round of the buyback by the end of 2016, but did not set an expiration date.
Dive Insight:
The company also announced plans to raise its dividend by 3 cents per share, to 39 cents per share, for the quarter. A buyback typically rewards investors by driving up stock prices and reducing available shares. The company had about $113 billion in cash on at the end of the last quarter.
Microsoft’s fourth-quarter earnings report released in July beat analysts' expectations, boosted by the company’s cloud business. Revenue in the company’s overall cloud business, including its Azure cloud platform and server software, rose 7% year over year in the fourth quarter to $6.7 billion. Microsoft’s primary cloud product, Azure, saw revenue more than double, growing 102% year over year.
