Payout Strategy

Finance

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Payout Strategy

The dividend payout strategy selected by Microsoft Corp as it announced a quarterly dividend of $0.36 per share on Sept. 15, 2015. Microsoft announced that its board of directors declared a quarterly dividend that indicating a five cent enhance or 16.1 % over the previous quarter’s dividend (Microsoft, 2015).  The dividend is payable December 10, 2015 to shareholders of record on November 19, 2015.  Microsoft has been paid dividend of $0.31 per share on Aug 18, 2015, but this time the company has increased the quarterly dividend due to the improvement in the performance of the business (Yahoo Finance, 2015). The ex-dividend date of Microsoft will be November 17, 2015.

Microsoft is the leading platform and productivity firm for the mobile-first, cloud-first world. The mission of Microsoft is to empower every person and every organization on the planet to achieve more. Microsoft is the part of growth strategy as the technology is becoming the necessary part of the human life. Technology industry and technology oriented companies have good future due to the many opportunities available related to update or innovation of technology. High potentiality and high performance or strong financial trends of Microsoft indicates that dividend payout strategy would be good for the firm (Microsoft, 2015). Moreover, through increased dividend announcement, the management is sending the indications of the shareholders and stakeholders that the company financial performance is improved and high future growth potentiality of the company.

Moreover, announced a quarterly dividend strategy would be make sense in terms of sending the indications of the shareholders and stakeholders that the company recent quarter financial performance is improved and it marinated growth trends, so it provided benefits of their shareholders. The strong financial performance, growth trend and high potentiality in the future of technology industry indicate this dividend announce payout strategy would be beneficial of Microsoft (MarketWatch, Inc., 2015). In addition, shareholder would be pleased with this quarterly dividend strategy announcement due to they achieved return on their investment and believed that their decision to invest in Microsoft is good for them and less risky for them in the context of the future.