Microsoft Monday said that it will buy back as much as US$40 billion worth of its own stock through the next five years. The share re-purchase announcement is a followup to similar plans made in 2004 and 2006, when the company bought $30 billion and $40 billion of its own stock, respectively. This new buyback will run until Sept. 30, 2013.

The company's board of directors also declared a quarterly dividend of 13 cents per share that will be paid Dec. 11.

"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, the company's chief financial officer, in a statement.

Analysts had wondered what Microsoft would do with its cash after it was spurned by Yahoo Inc.. The Redmond, Wash., company first offered to buy Yahoo in February for an estimated $44.6 billion, but after Yahoo balked and demanded more, Microsoft withdrew its offer in May.

According to Microsoft's most recent financial statement, as of June 30 it had $23.7 billion in cash on hand.

The news sent Microsoft's shares up $1.02, or 4.01%, in early trading.

» posted by ITworld staff

Computerworld

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