The tech company plans to buy up to $60 billion (€53.9 billion) in shares to satisfy investors.
The massive financial package will bring Microsoft a sizable number of shares back into its own hands. Currently, one share costs $431. Still, the $60 billion is a small fraction of its current market value of $3.21 trillion. If the complete buyback program is implemented, just under 2 percent of shares will return to Microsoft. However, The company notes that the plan could be terminated at any time.
Although Microsoft’s supervisory board agreed to the $60 billion package, the exact reason was not communicated in the announcement. However, according to Capital Letter, the tech company wants to use this to reassure shareholders, who may be wary because of the high investments in AI in the past and coming months. For example, the company has already invested over $10 billion in ChatGPT maker OpenAI.
In addition to the buyback program, Microsoft is increasing the quarterly dividend for shareholders. They will now receive an earnings distribution of $0.83 per share, 10 percent more than before.
Battle with Apple
Currently, Microsoft is the second most valuable company in the world. Only Apple has a higher market value, at $3.29 trillion. Microsoft has held this title in the past, so the battle with Apple for the title continues. In any case, the market received the buyback program and dividend increase positively, resulting in an increase of just over 0.7 percent for Microsoft aftermarket.