Share buyback announced by Microsoft

<p>Microsoft has announced a massive new share buyback.</p>

Microsoft has confirmed a large increase in dividends being paid to shareholders and revealed it is also launching a major new share buyback.

The company announced that it will be raising the dividend payout by 22 per cent, as well as launching a share buyback worth a total of $40 billion (£25.1 billion).

In the immediate aftermath of the announcement, the share price of the firm was up by 1.4 per cent, meaning stocks are up eight per cent on the start of 2010.

"These actions reflect a continued commitment to returning cash to our shareholders," said Amy Hood, chief financial officer of Microsoft.

The company is set to hold a meeting for financial analysts on Thursday (September 19th).

When the Nasdaq opens in the US later today, the share price of Microsoft is set to open at 32.93. This is not too far from its year-high level of 36.43.

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