Yesterday Microsoft finally announced that they will be returning cash to the owners of the company... the shareholders. For the first time in recent memory, the company has surprised me in a positive way with the amount of cash being returned. First the company will double its yearly dividend from 16 cents a share to 32 cents a share. While this isn't exactly a huge number when looked at from a dividend yield perspective, the company has been agressivly raising the dividend recently and I am hopeful that will continue over the next few years. In addition to raising the yearly dividend, the company will have a special one time dividend of $3 per share. The last part of the program calls for the company to buy back around $30 billion in stock, which will reduce the number of shares outstanding, therefore raise the EPS and raise the stock price over time.
All of these programs combined will result in around $75 billion being "returned" to shareholders. Now that the company has committed to keeping less cash at hand I wonder if we can expect better corporate repsonsibility when it comes to entering the right businesses (see all of Microsoft's failed hardware plays) and mergers (see the proposed SAP merger).
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