Microsoft repurchases 40,000 million of its own shares

Microsoft is close to presenting its quarterly results, and we are seeing several movements that affect its relationship with shareholders. Yesterday we told you that those of Redmond were going to measure their success in video games with a new metric, leaving Xbox Live in the background. Today we can tell you that the company has announced its intention to repurchase nothing less than 40,000 million dollars of its shares, and announces dividends per share of 51 cents, 10% more than what it had been paying so far.

The creators of Windows have already opened up to buy back shares in 2016, and it has not been until last June when the previous operation was closed. Obviously Microsoft cannot force its shareholders to sell and therefore it may take years until a buyback is concluded. After the announcement, Microsoft shares have risen 1% Since these types of operations are usually a good sign of financial results.

Why does Microsoft want to buy back its own shares?

A repurchase of shares can occur for several reasons, and are usually positive except in cases where the company needs a loan to undertake the operation, which is not Microsoft. The most common reason is usually the cash reinvestment that is not being used (Microsoft has reached up to 85K million inactive dollars), and it is better to have it in the hands of shareholders. Another possibility is that the shareholders meeting decides to reduce the number of shares among which dividends are distributed before positive prospects. Why distribute between fifty if we can do between twenty at zero cost?

In short, Microsoft has so much inactive money that its majority shareholders prefer to use that money to secure higher dividends in the future. In case there is any doubt we should not worry about the coffers of a company, which He has more money than ideas on how to invest it.