Microsoft launches $60 bln share buyback program

Microsoft recently announced that its board has approved a new share buyback program valued at up to $60 billion. In addition, the company declared a quarterly dividend of $0.83 per share, marking a 10% increase over the previous quarter's dividend.

This announcement comes as Microsoft continues to invest heavily in artificial intelligence (AI) infrastructure. The company had previously revealed in July that capital spending surged by 77.6% in the quarter ending June 30, largely driven by AI-related investments. Microsoft expects these AI expenditures to grow throughout the fiscal year.

At the same time, the tech giant reported a slowdown in growth for its Azure cloud services in the same quarter. However, it forecasted a return to faster growth in Azure by the second half of fiscal 2025, reassuring investors about its long-term cloud strategy.

The move to boost shareholder returns comes amid increasing pressure on major tech firms like Microsoft and Alphabet (Google) to demonstrate returns on their AI investments. Microsoft, unlike many of its peers, is one of the few companies that actively highlights AI's contribution to its earnings reports.

Microsoft's annual shareholders meeting is set for December 10. Meanwhile, in aftermarket trading, Microsoft shares saw a slight uptick, adding to the roughly 15% gain the stock has recorded so far this year.

The company's new buyback plan follows a similar move by Apple, which earlier this year announced a record $110 billion share repurchase after posting strong quarterly results.