Microsoft Sets $40 Billion Buyback -- WSJ
September 19 2019 - 3:02AM
Dow Jones News
By Kimberly Chin
This article is being republished as part of our daily
reproduction of WSJ.com articles that also appeared in the U.S.
print edition of The Wall Street Journal (September 19, 2019).
Microsoft Corp. said it plans to buy back as much as $40 billion
in stock and raise its dividend 11%, maintaining its record of
sharing its flood of cash with shareholders.
This is the third time the software giant has authorized a
buyback plan of that size. The board previously authorized such
repurchases in 2013 and again in 2016.
Microsoft said there is no expiration date for the latest
share-repurchase program. The company also said it could cut the
program short.
Microsoft, now the largest publicly traded company, has posted
strong earnings growth from a bet on cloud-computing that helped it
beat Wall Street estimates in the fiscal fourth quarter, which
ended June 30. Sales rose 12% and profit soared 49% from a year
earlier.
The Redmond, Wash., company made the repurchase announcement
Wednesday as it was on pace to reach the end of its 2016
share-buyback program within a few months. The company had $11.4
billion of that program remaining as of June 30, according to
filings. Microsoft bought about $4.6 billion of its own stock in
the April-through-June quarter. The buyback represents about 3.8%
of Microsoft's more than $1 trillion market value.
From the fiscal years between 2017 and 2019, the company
repurchased a combined 419 million shares for roughly $35.7
billion, the company said.
Shares rose 1.2% to $138.67 in after-hours trading. The
company's shares have risen 36% year to date.
Microsoft also raised its quarterly dividend by 5 cents to 51
cents a share, or 11% above the prior quarter's payout and a
slightly higher dividend increase than the company announced a year
ago. The dividend will be payable Dec. 12 to shareholders of record
Nov. 21.
Microsoft's cash from operations was $52.2 billion for the
fiscal year ended June 30. The company in July said its growth
momentum was continuing. Chief Financial Officer Amy Hood told
analysts that the current fiscal year should again include a
double-digit sales gain in the cloud-computing business, where
Microsoft is the No. 2 competitor behind Amazon.com Inc.
(END) Dow Jones Newswires
September 19, 2019 02:47 ET (06:47 GMT)
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