MSFT - Microsoft Corporation

NasdaqGS - NasdaqGS Real-time price. Currency in USD
+2.10 (+1.25%)
At close: 4:00PM EST

166.80 -3.37 (-1.98%)
After hours: 8:00PM EST

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Previous close168.07
Bid167.85 x 1100
Ask167.99 x 800
Day's range168.22 - 173.26
52-week range108.80 - 190.70
Avg. volume27,895,878
Market cap1.294T
Beta (5Y monthly)1.15
PE ratio (TTM)29.64
Earnings dateN/A
Forward dividend & yield2.04 (1.20%)
Ex-dividend date18 Feb 2020
1y target estN/A
  • Microsoft Joins Apple, HP in Scrapping Outlooks on Virus

    Microsoft Joins Apple, HP in Scrapping Outlooks on Virus

    (Bloomberg) -- Microsoft Corp. became the latest tech giant to reduce its quarterly outlook based on the outbreak of a novel coronavirus that’s slowing production of computers and crimping sales of an array of consumer services and electronics.In a statement Wednesday, the company said it doesn’t expect to meet earlier guidance for fiscal third-quarter revenue in the Windows personal-computer software and Surface device business because the supply chain is returning to normal at a slower pace than expected. Last month, Microsoft gave a wider-than-usual sales target -- $10.75 billion to $11.15 billion -- for that division, citing uncertainty related to the spread of the deadly respiratory virus.The world’s largest software maker joins iPhone maker Apple Inc. and PC company HP Inc. in cutting estimates because of supply-chain disruptions related to the virus, known as Covid-19. Merchants who sell on Inc. also are trimming ad spending on the e-commerce giant’s marketplace, seeking to moderate demand amid worries they may run out of inventory of Chinese-made goods. Questions about the virus’ economic ripples had already sent the S&P 500 Index down by 6.6% this week; Microsoft’s acknowledgment that the PC market is being hit reinforces investor concerns about broader consequences, said Dan Ives, an analyst at Wedbush Securities.“It fans the flames on Corona worries,” Ives said. “Apple and Microsoft now confirm the negative impact the Street had feared.”In recent days, anxiety has mounted about the spread of the virus outside of China, where it originated. For the first time, more cases were reported in countries other than China in the past 24 hours, the World Health Organization said late Wednesday, a significant development as new cases spread around the globe, with South Korea, Italy and Iran particularly hard hit. Globally 2,771 have died and 81,317 people have been infected.As component makers and tech-gadget assembly companies in China continue to face production slowdowns due to quarantines and shuttered factories, U.S. technology companies are reported to be scrambling for alternatives. Microsoft and Alphabet Inc.’s Google are looking at manufacturing facilities in Vietnam and Thailand, the Nikkei Asian Review reported Wednesday.Microsoft shares declined about 2% in late trading following the announcement. The stock has fallen in four of the last five trading sessions, along with the broader market, on concerns that the spreading health crisis could hurt the global economy and the technology sector. The shares had been trading at all-time highs earlier this month. Shares of Intel Corp., the biggest PC chipmaker, and rival Advanced Micro Devices Inc. also fell in extended trading, as did PC makers Dell Technologies Inc. and HP. Dell reports earnings Thursday.The reduced forecasts come as Covid-19’s impact spreads through global companies in a range of industries. Booking Holdings Inc. on Wednesday said room nights booked would drop 5% to 10% in the first quarter, compared with analysts’ estimates for an increase of 5%. The company said cancellations are rising.For Microsoft, demand for Windows operating-system software is strong and has been in line with the company’s forecasts, according to the statement. The rest of the company’s outlook for the current quarter remains unchanged. On average, analysts were predicting total sales of $34.6 billion for the period ending in March, according to estimates gathered by Bloomberg. The More Personal Computing unit typically generates more than a third of Microsoft’s annual sales.Microsoft will have to account for supply issues with its Surface devices and lost software sales from Windows on PCs made by other manufacturers who may be facing the same production and parts challenges in China. The Redmond, Washington-based company is also preparing to release a new generation of Xbox video-game consoles in the fall, and will need to work through setting the final production lines and then building up inventory ahead of that release, a process that could be affected by lingering shutdowns in China.The spread of the virus outside of China also raises the chances of impact of work shutdowns, quarantines, store closures, and conference and meeting cancellations in other countries where technology and other global firms have a significant presence.To contact the reporter on this story: Dina Bass in Seattle at dbass2@bloomberg.netTo contact the editors responsible for this story: Jillian Ward at, Andrew PollackFor more articles like this, please visit us at bloomberg.comSubscribe now to stay ahead with the most trusted business news source.©2020 Bloomberg L.P.

  • Microsoft expects Windows unit to miss revenue outlook on coronavirus impact

    Microsoft expects Windows unit to miss revenue outlook on coronavirus impact

    Microsoft is the second company in the trillion dollar club to withdraw outlook. The software maker had previously expected the More Personal Computing unit, which houses Windows, to post third-quarter revenue between $10.75 billion and $11.15 billion. Its Windows and Surface computers had been more negatively impacted than expected, Microsoft said in a statement.

  • Bloomberg

    A $7 Billion Robot to Automate Boring Tasks Eyes an IPO

    (Bloomberg) -- UiPath, a software maker valued last year at $7 billion, is getting closer to an initial public offering after helping some of the biggest companies in the U.S. automate routine processes.Armed with last year’s $568 million funding round that gave the New York-based company its multi-billion dollar valuation, co-founder and Chief Executive Officer Daniel Dines sees more growth on the cards. The bourse entry may take place as soon as early next year, depending on market conditions and strategic decisions.“We just started our growth journey in 2016 and if you look at the average age of a company to do an IPO it’s probably 7 years, so there’s” no reason to hurry, Dines said in an interview from New York. “You have to become a public company at some point to allow your employees to get more liquidity, give them stock options. We’re almost there.”Founded in Romania in 2005 as DeskOver and renamed in 2015, UiPath’s client base includes the CIA, the U.S. Navy, McDonald’s Corp, Duracell and Swiss Re. The company had $360 million in annual recurring revenue last year and it attracted funding from investors such as Sequoia, CapitalG, Wellington Management, Sands Capital and others.“Even though UiPath technically can do an IPO, I think they don’t have to do that. They already got a huge amount -- $1 billion -- in venture funding and don’t have to get their hands tied up in the capital market. The only RPA company that went IPO is Blue Prism, which wanted to issue additional shares to cover its operating losses last year but struggled to get shareholder approvals”\--Kathy Gao, a BloombergNEF analyst focused on the digital industryBlue Prism said in an email it hadn’t had any difficulties getting shareholder approval for an additional issuance last year, adding that it executed its 100 million pound ($129 million) placement last January with ease, received 99% shareholder approval and used the proceeds to fund expansion.UiPath’s software performs low-skilled and repetitive tasks once outsourced to humans in cheaper-wage countries, via “robotic process automation,” or RPA. Examples include the processing of applications for jobs, pensions or handling student data at universities.Virus BacklogUiPath, which became Romania’s first unicorn in 2018, competes with other software vendors such as Blue Prism Group Plc, Kofax, and Automation Anywhere Inc. Dines, who ruled out acquisitions in the near future, didn’t give financial details on UiPath’s potential IPO.“We’ve seen increased competition, even Microsoft said they will come with an RPA solution,” Dines said. “This is a great validation for the industry.”One key area to watch is the use of UiPath to help hospitals fighting the coronavirus to avoid backlogs and speed up diagnosis, according to Dines.“RPA has become a really big and established sector and many companies have plans to implement it,” he said.(Updates with Blue Prism comment in 6th paragraph)To contact the reporters on this story: Andra Timu in Bucharest at;Irina Vilcu in Bucharest at isavu@bloomberg.netTo contact the editors responsible for this story: Andrea Dudik at, Andras Gergely, Piotr BujnickiFor more articles like this, please visit us at bloomberg.comSubscribe now to stay ahead with the most trusted business news source.©2020 Bloomberg L.P.

  • The Zacks Analyst Blog Highlights: Microsoft, Apple, IBM, McDonald's and Coca-Cola

    The Zacks Analyst Blog Highlights: Microsoft, Apple, IBM, McDonald's and Coca-Cola

    The Zacks Analyst Blog Highlights: Microsoft, Apple, IBM, McDonald's and Coca-Cola

  • Top Ranked Momentum Stocks to Buy for February 26th

    Top Ranked Momentum Stocks to Buy for February 26th

    Top Ranked Momentum Stocks to Buy for February 26th

  • The Zacks Analyst Blog Highlights: Apple, Walt Disney and Microsoft

    The Zacks Analyst Blog Highlights: Apple, Walt Disney and Microsoft

    The Zacks Analyst Blog Highlights: Apple, Walt Disney and Microsoft

  • Forget Virus Scare, Buy Tech ETFs on the Dip

    Forget Virus Scare, Buy Tech ETFs on the Dip

    Wall Street is suffering a bloodbath on rising coronavirus scare, with tech stocks leading the slump. Use the dip in tech ETFs as a buying point.

  • Oracle Reveals Funding of Dark Money Group Fighting Big Tech

    Oracle Reveals Funding of Dark Money Group Fighting Big Tech

    (Bloomberg) -- When the Internet Accountability Project popped up late last year and joined the growing crusade against Big Tech, the nonprofit group refused to say who was financing it.Turns out, at least one of its benefactors is Oracle Corp.Oracle donated between $25,000 and $99,999 last year to the internet project, according to a new political-giving report Oracle posted on its website. The group calls itself a conservative nonprofit advocating for tougher privacy rules and stronger antitrust enforcement against the internet giants.The IAP financing is just one part of an aggressive, and sometimes secretive, battle Oracle has been waging against its biggest rivals, including Inc. and Alphabet Inc.’s Google.Oracle spent years fighting to unseat Amazon as the front-runner for a lucrative Pentagon cloud contract, which was awarded to Microsoft Corp. in October.The Redwood City, California, company has also been locked in a decade-long legal dispute with Google, claiming the search-engine giant violated Oracle copyrights by including some Java programming code in the Android phone. Oracle acquired Java’s developer, Sun Microsystems Inc., in 2010.Earlier this month, IAP filed an amicus brief supporting Oracle’s position in the case. IAP said it wants to “ensure that Google respects the copyrights of Oracle and other innovators.” The U.S. Supreme Court on March 24 will hear oral arguments in the Google v. Oracle America case.The Trump administration on Feb. 19 also urged the Supreme Court to reject Google’s appeal in the case. Its brief appeared the same day that Larry Ellison, Oracle’s co-founder and chairman, hosted a high-dollar fundraiser at his Rancho Mirage estate for President Donald Trump. The event prompted about 300 Oracle employees to stage a protest the next day. The U.S. had previously supported Oracle as the case wound its way through the courts.Oracle’s donations disclosure reveals that it contributed to at least four other groups that filed supportive briefs in the Supreme Court case. Google has also donated money to at least 10 groups that have filed briefs on its behalf in the high court case.Oracle and Amazon didn’t immediately respond to requests for comment about the Oracle disclosure. Google declined to comment.IAP President Mike Davis said in a statement the group doesn’t disclose its financial backers but specified that Oracle didn’t fund its Supreme Court brief.The internet project was launched in September by Davis, a former aide to Republican Senator Chuck Grassley of Iowa, and Rachel Bovard, a former aide to Republican Senator Rand Paul of Kentucky. The group aims to “lend a conservative voice to the calls for federal and state governments to rein in Big Tech before it is too late,” according to its website.The IAP is a Section 501(c)(4), known as a “social-welfare” organization. That designation means it isn’t required to disclose donors as long as it doesn’t spend more than half of its money on campaign advertisements or activities to sway an election.Among other policies, IAP supports curtailing Section 230 of the 1996 Communications Decency Act, which shields tech companies from liability for content that users post on their platforms. The clause saves tech companies from having to review content before it’s published online, and then shields them from lawsuits if that content turns out to be problematic.Earlier: Barr Takes Aim at Legal Shield Enjoyed by Google, FacebookIn interviews and on social media, IAP has supported Republican Senator Josh Hawley of Missouri, who has proposed that tech companies lose the legal immunity unless they can prove to the Federal Trade Commission that they treat their content in a politically neutral manner.Since September, IAP has tweeted at least 11 times about Hawley’s legislative efforts against Google and other tech companies. Other IAP tweets highlight instances in which Google-funded groups fought on the internet giant’s behalf.“Holy smokes you guys, DC is awash in @Google money,” Bovard tweeted in September.Davis, the group’s president, wrote last week on that Google’s battle with Oracle is “the poster child for what we at IAP call ‘the Great 21st Century Internet Heist.’” He said the company “is anathema to conservatives and everything we stand for,” without disclosing that his group is funded by Oracle.Earlier: It’s the Kochs vs. the Mercers in the Right’s Big Tech BrawlOracle claims Google owes it at least $8.8 billion for using the Java code without a license. Google argues it was fair to use parts of the programming language to help Android communicate more easily with other software.The case has split Silicon Valley by pitting software makers who favor stronger copyright protections against companies that rely on others’ code to produce new innovations.Other CampaignsIAP is far from the only anti-tech group Oracle has funded. It also gave between $25,000 and $99,999 to the Free and Fair Markets Initiative, according to the disclosure.Free and Fair Markets claims it is a grassroots coalition of businesses and advocacy groups fighting for a better economy. In practice, it has focused more on publicizing negative reports about Amazon. The Wall Street Journal reported that Oracle, Walmart Inc. and the Simon Property Group had financed the group.For the last two years, Oracle has also waged a multi-front battle against Amazon over the Pentagon’s Joint Enterprise Defense Infrastructure, or JEDI, cloud contract. The deal, which could be worth $10 billion over a decade, is designed to transition much of the Pentagon’s data into one commercially operated cloud system.For more: Oracle’s Catz Is Said to Talk Amazon Contract Row With TrumpAmazon was seen as the leading contender because it had already won a major cloud contract with the U.S. Central Intelligence Agency and had obtained high levels of security clearance. The move to Amazon’s cloud would have threatened Oracle’s legacy database business with the Defense Department.Oracle led a coalition of other tech companies, including Microsoft Corp. and International Business Machines Corp., to oppose the Pentagon’s decision to award the contract to a sole bidder. In addition to lobbying Congress and the Trump administration, Oracle also filed -- and lost -- challenges through the Government Accountability Office and the U.S. Court of Federal Claims.Oracle is currently appealing a July ruling that it lacked standing to challenge the contract.(Updates with comment from IAP in paragraph 11)\--With assistance from Greg Stohr.To contact the reporters on this story: Naomi Nix in Washington at;Joe Light in Washington at jlight8@bloomberg.netTo contact the editors responsible for this story: Sara Forden at, Paula DwyerFor more articles like this, please visit us at bloomberg.comSubscribe now to stay ahead with the most trusted business news source.©2020 Bloomberg L.P.

  • Tech Daily: Regulatory & More

    Tech Daily: Regulatory & More

    The planned digital tax, a new bill that could impact encryption, developments on U.S. Google's antitrust case and Amazon's challenge of the JEDI contract and other news is covered in this article.

  • Give Your Child a Head Start in Investing: 3 Big Brand Stocks

    Give Your Child a Head Start in Investing: 3 Big Brand Stocks

    Invest in big brand stocks for your children, as these stocks generally boast stable cash flow, and being big brands, consumers have confidence in their products' quality, durability and consistency.

  • The Zacks Analyst Blog Highlights: Microsoft, Nvidia and Alibaba

    The Zacks Analyst Blog Highlights: Microsoft, Nvidia and Alibaba

    The Zacks Analyst Blog Highlights: Microsoft, Nvidia and Alibaba

  • CenturyLink Augments Cloud Solutions With Azure MSP Program

    CenturyLink Augments Cloud Solutions With Azure MSP Program

    CenturyLink (CTL) collaborates with Microsoft Azure's Networking Managed Service Provider Program to offer seamless cloud and networking solutions for a plethora of businesses and consumers.

  • Amazon Adopts Rivals’ Playbook to Fight JEDI Cloud Bid Loss

    Amazon Adopts Rivals’ Playbook to Fight JEDI Cloud Bid Loss

    (Bloomberg) -- A powerful executive with Inc. in October portrayed attempts by archrival Oracle Corp. to block her company from winning one of the biggest-ever government deals as a last-ditch attempt to rescue a business that was becoming irrelevant.Now, Amazon is borrowing a page from the playbook Oracle used to unseat it as the front-runner for an up to $10 billion, 10-year project to overhaul the military’s technological operations.Amazon filed suit in federal court in November after the Pentagon, in a surprise move, on Oct. 25 awarded the contract to Microsoft Corp. Amazon asserted that the procurement was corrupted by the intervention of President Donald Trump, whose disdain for Jeff Bezos, its chairman and chief executive officer, is widely known.“Amazon is going to the mattresses,” said Stan Soloway, a deputy undersecretary of defense under President Bill Clinton and now president of Celero Strategies, a Washington-area consulting firm. “It feels like the same scorched-earth approach” that Oracle took.Earlier, Amazon had sounded a very different note on legal challenges in the government contracts arena. Two days before it lost the award to Microsoft, Teresa Carlson, who oversees government contracting for the company’s profitable cloud-computing unit, Amazon Web Services, derided efforts by Oracle and others to cast the Pentagon’s bidding process as corrupt and rigged in Amazon’s favor.It’s “kind of sad” when losers routinely protest procurement decisions “because it delays innovation,” she told other female corporate leaders, lobbyists and government officials at a Washington conference.Amazon’s combative legal strategy includes seeking Trump’s deposition, which legal experts say is unlikely but not impossible. It hopes to block the Pentagon from putting the cloud project into effect without a new evaluation or award decision.The longer the delay, the more time it has to gather depositions from officials, win over lawmakers, influence public opinion and prevent Microsoft from doing anything on the cloud project that would be hard to reverse. It’s also claiming the Defense Department lowered its standards by choosing Microsoft.Microsoft declined to comment. Oracle didn’t respond to a request for comment. Amazon pointed to earlier statements from company spokesman Drew Herdener who said the contract evaluation was tainted by deficiencies and “unmistakable bias.”The company scored an early win on Feb. 13 when a U.S. Court of Federal Claims judge temporarily blocked Microsoft from working on the Joint Enterprise Defense Infrastructure, or JEDI, cloud program while the lawsuit is pending. The order, which is still sealed, says the Pentagon must stop working on the contract “until further order of the court.”The e-commerce giant’s newfound aggressiveness has surprised some observers. The company remained a champion of the project in 2018 and 2019, while Oracle mounted a fierce lobbying and public-relations effort to stop the Pentagon from awarding a sole-source contract. “I didn’t think” they would protest even if they lost, Soloway said.Over the last two years, Oracle has filed -- and lost -- challenges at the Government Accountability Office and the federal claims court. Those efforts resulted in news stories airing its claims of unethical behavior by Pentagon and Amazon officials.Oracle’s audience wasn’t only bureaucrats and judges, but also the White House, lawmakers and the general public, all of which were simultaneously being flooded with revelations about Pentagon employees who worked on the procurement in its early days and then left to work for Amazon.Amazon is similarly seeking common cause with outsiders. Its case so far has attracted briefs from Protect Democracy, an anti-corruption group, and Citizens for Responsibility and Ethics in Washington, which has sued the Trump administration numerous times for alleged ethics lapses. Both organizations say they haven’t received money from Amazon.Amazon’s court case could help amplify its perspective on the procurement the same way that Oracle’s challenges attracted media attention. “There is also potential in litigation that you are arguing to members of Congress and the public,”said Steven Schooner, a professor of procurement law at George Washington University Law School.The company has been characterizing the loss of the contract as a political, not a technical, decision. Its suit contends that Pentagon officials artificially lowered their evaluation of the company’s proposal and that Trump “launched repeated public and behind-the-scenes attacks to steer the JEDI contract” away from Amazon “to harm his perceived political enemy” -- Bezos.Earlier this month, Jay Carney, Amazon’s top spokesman, told CNBC that the company was taking legal action because it believes that “blatant political interference” affected the award decision. Trump has long criticized Bezos over everything from the shipping rates Amazon pays the U.S. Postal Service to his ownership of the Washington Post.While Oracle charged that Pentagon officials failed to properly investigate ethical issues surrounding the bid, Amazon goes further by arguing that bias cost it the deal. Amazon alleges that the Defense Department, swayed by Trump’s animosity, unfairly judged its bid. It cites passages in a book by the speechwriter to former Defense Secretary James Mattis, stating Trump once told Mattis to “screw Amazon” out of the bid. (Mattis has criticized the book.)“Contracting officers are accused every day of not playing by the rules but rarely that they had a vendetta,” said Charles Tiefer, a professor at the University of Baltimore School of Law.Microsoft, International Business Machines Corp. and other Amazon rivals at times joined forces with Oracle to try to stop the Pentagon from awarding the cloud contract to a single company, which made Amazon the obvious front-runner.Amazon not only was the market leader in the cloud-server industry, it also had won high-level security clearances from its previous work moving the Central Intelligence Agency’s data to the cloud.The tech companies courted the press and Defense Department cloud-services buyers. The Oracle coalition also descended on Capitol Hill, appealing particularly to members of the Armed Services committees. Some of the lawmakers would later propose curtailing the Pentagon’s funding for the contract until it justified its strategy.Amazon, likewise, in June hired a Trump-connected lobbyist, Jeff Miller, just before Trump disparaged the bidding process as uncompetitive, citing complaints from Oracle, Microsoft and IBM.Oracle’s legal challenges helped Microsoft catch up technologically -- and ultimately win. During the nearly three-year process, Microsoft won new deals with large customers such as Chevron Corp., AT&T Inc. and more than a dozen intelligence agencies that bolstered its standing in the marketplace.Delay Was Microsoft’s AllyMicrosoft, in addition, invested in a portable Azure system to analyze and transfer data to the cloud from the battlefield. The delay also gave Microsoft time to attain a higher level of government security, though it still hasn’t matched Amazon’s top-secret certification.Oracle, too, may have benefited from the delays it continued to engineer even after it was eliminated. Oracle, which sells large amounts of legacy software to the Pentagon, already has a partnership with Microsoft that it could use to win more business from the Defense Department.With much of the fighting between Amazon and Oracle in the rear-view mirror, JEDI’s fate rests with the federal courts. As Amazon waits for the U.S. Court of Federal Claims to decide on its request to depose Trump and Pentagon officials, Oracle is appealing a July ruling that it lacked legal standing to challenge the bidding.“People file these suits for all kinds of reasons,” Tiefer said. “You could argue that one of the things that Amazon wants is a legitimate explanation for why they lost.”\--With assistance from Dina Bass.To contact the reporter on this story: Naomi Nix in Washington at nnix1@bloomberg.netTo contact the editors responsible for this story: Sara Forden at, John HarneyFor more articles like this, please visit us at bloomberg.comSubscribe now to stay ahead with the most trusted business news source.©2020 Bloomberg L.P.

  • Bloomberg

    British Startup Graphcore Hits $2 Billion Valuation

    (Bloomberg) -- Graphcore Ltd., the British semiconductor firm whose chips are used to run artificial intelligence programs, has raised $150 million, bringing its valuation to $1.95 billion.The company now has $300 million in cash, which it will use to invest in research and development and global expansion, Bristol, England-based Graphcore said in a statement on Tuesday.After it raised $200 million in 2018, Graphcore was approached by additional investors who wanted to put money into the company, Chief Executive Officer Nigel Toon said in an interview.While the company has no immediate plans for an initial public offering, several of its investors, such as Baillie Gifford, have experience investing in publicly traded technology companies and are the types of shareholders the company would try to target if it were to go public at some point in the future, Toon said.“Having this additional capital on hand allows us to accelerate our investment and allows us to be in a position to support the really large customers who we’re building business with,” Toon said.Read Businessweek’s profile of Graphcore here.Programs running artificial intelligence have different requirements from traditional software. Instead of telling machines what to do step-by-step, AI learns from pools of data, making greater demands on a computer’s memory and a processor’s energy use. Chips built to run artificial intelligence programs, therefore, have to prioritize efficiency.Graphcore’s chips are designed for “less precise” computing, mimicking the way human brains work, and helping artificially intelligent machines draw conclusions more like we do. They also need more processing power.Late last year, Graphcore announced a deal with Microsoft Corp. to offer its processing units on the U.S. company’s Azure cloud platform, with financial services giant Citadel an early customer.Graphcore has been adding engineers, expanding its operations in Asia and the U.S., and ramping up its customer service force and software development arm. The firm is also building out a team in Oslo that’s creating large-scale systems connecting thousands of its processors that can take on increasingly complex problems, like those raised by natural-language processing, which is important for the digital assistants proliferating on home speakers and smartphones, and self-driving cars.The current round includes Baillie Gifford, Mayfair Equity Partners, and M&G Investments. The firm, founded in 2016, has also previously gotten investment from Microsoft, BMW and Samsung Electronics Co.To contact the reporter on this story: Amy Thomson in London at athomson6@bloomberg.netTo contact the editors responsible for this story: Giles Turner at, Molly SchuetzFor more articles like this, please visit us at bloomberg.comSubscribe now to stay ahead with the most trusted business news source.©2020 Bloomberg L.P.

  • HP Will Return $16 Billion to Investors to Parry Xerox Bid

    HP Will Return $16 Billion to Investors to Parry Xerox Bid

    (Bloomberg) -- HP Inc. announced it will return $16 billion to shareholders, primarily through buybacks, and boost cost cuts, trying to rally investors against Xerox Holdings Corp. for control of the world’s second-largest personal computer maker.HP will increase share repurchases to $15 billion from a $5 billion program announced in October. This will result in adjusted profit of $3.25 to $3.65 per share in fiscal 2022, which is about $1 more per share than analysts’ projections. HP executives also said they have engaged Xerox to discuss a potential combination on their terms, rather than succumbing to the printer maker’s hostile takeover effort.The hardware giant raised its profit forecast for fiscal 2020 to as much as $2.43 a share, excluding some expenses, bolstered by the surge of share repurchases scheduled after the company’s annual meeting. For the current period, profit will be 49 cents a share to 53 cents a share, the Palo Alto, California-based company said Monday in a statement. The forecast fell short of Wall Street’s estimate of 54 cents, according to data compiled by Bloomberg.HP executives said supply-chain disruptions related to the coronavirus outbreak will cost the company about 8 cents a share in adjusted profit in the current quarter. HP doesn’t expect the virus known as COVID-19 to affect performance in the second half of 2020.The company also said it would raise its cost-cutting program to $1.2 billion by 2022. HP, which had 56,000 workers as of October, is in the midst of a restructuring that could result in as many as 9,000 employee dismissals.HP’s shares gained about 4% in extended trading after closing at $22.10 in New York. The stock has declined about 7% in the past 12 months.HP has repeatedly rejected Xerox’s effort to secure a $35 billion acquisition, saying it “significantly undervalues” the company. A deal would unify two icons of the technology industry that pioneered innovations consumers and office workers still use today, but have faded in an industry increasingly driven by software. Xerox has said it will launch a tender offer “on or around March 2” for HP shares valued at $24 in cash and stock. For each HP share, a holder would get $18.40 in cash and 0.149 Xerox shares. Norwalk, Connecticut-based Xerox has also started a proxy fight, nominating 11 candidates for HP’s board to help close the deal.“We had a very strong first quarter, are putting in place a very aggressive plan and we are confident we can deliver on it, as we have in the past,” HP Chief Executive Officer Enrique Lores said in an interview. “We are open to explore a combination. Any combination needs to address three issues: it needs to reflect the right value exchange, needs to have the right capital structure and needs to have the right assessment of synergy.”HP believes a deal with Xerox would only unlock $1 billion in cost savings, not the $2 billion Xerox executives have promised, because only 10% of their businesses overlap, Lores said. HP will use a combination of cash on hand and debt to fund the buybacks. Chief Financial Officer Steve Fieler said he expects to take out a “few billion” dollars of debt. The company is committed to retaining a debt ratio of 1.5 times to 2 times profit, from 1.1 times currently.Xerox’s largest investor, activist Carl Icahn, has pushed for a tie-up in any form, so long as Xerox CEO John Visentin leads the combined company.HP structured the buybacks as an incentive for investors to reject Xerox’s director candidates. If shareholders vote against the challengers, they’ll start to see a benefit from $8 billion in buybacks over the next year, according to HP. The company said it would issue a proxy statement in the next week to announce the date of its annual meeting, which is usually in April.Fiscal first-quarter profit was 65 cents a share, excluding some expenses. That surged past HP’s previous projection of as much as 56 cents for the quarter. Analysts estimated 54 cents.For a year, HP has sought to stabilize its profitable printing division, which started stumbling in February 2019 due to lower customer demand for ink and toner. Revenue declined less than 1% to $14.6 billion in the period ended Jan. 31. Sales in the printing division fell 7% to $4.7 billion, with ink supplies dropping 7% in the period ended Jan. 31. Consumer hardware revenue declined 13% and commercial devices decreased 1%.In response to the falling ink sales, HP plans to change its business model starting late this year to make some printers profitable upfront, rather than heavily discounting them and making up the difference with ink sales. The company’s cheap printers will now be incompatible with generic or counterfeit ink cartridges.HP is the leader in the printing industry, with 20.6% of the market by revenue, according to research firm Gartner Inc. Xerox is fourth, with 10% of the industry.Revenue from personal computers increased 2.4% to $9.9 billion in the quarter, despite disruptions from the coronavirus outbreak. There were sales increases across laptops, desktops and workstations. Corporate clients are upgrading their computers to adopt Microsoft Corp.’s Windows 10 operating system.(Updates with talks about a potential deal in the second paragraph.)\--With assistance from Scott Deveau.To contact the reporter on this story: Nico Grant in San Francisco at ngrant20@bloomberg.netTo contact the editors responsible for this story: Jillian Ward at, Andrew Pollack, Molly SchuetzFor more articles like this, please visit us at bloomberg.comSubscribe now to stay ahead with the most trusted business news source.©2020 Bloomberg L.P.

  • 3 Blue-Chip Tech Stocks for Investors to Buy Now to Fight Coronavirus Fears

    3 Blue-Chip Tech Stocks for Investors to Buy Now to Fight Coronavirus Fears

    Check out these three blue-chip tech stocks that investors might want to buy now to help fight heightened coronavirus fears...

  • Coronavirus Infects Equity Markets: 3 Blue Chips To Consider

    Coronavirus Infects Equity Markets: 3 Blue Chips To Consider

    The coronavirus is infecting the equity markets as this disease spreads past China's borders

  • Top Stock Picks for the Week of Feb 24, 2020

    Top Stock Picks for the Week of Feb 24, 2020

    Tracey Ryniec and Dan Laboe discuss two tech giants whose earnings outlook is bullish.

  • HP CEO sends a major message to Xerox: Go away, we don't need you
    Yahoo Finance

    HP CEO sends a major message to Xerox: Go away, we don't need you

    HP management sends a clear message to would he acquirer Xerox.

  • Microsoft offers a closer look at the next Xbox

    Microsoft offers a closer look at the next Xbox

    It’s been a few months since Microsoft announced the impending arrival of the Xbox Series X. The somewhat redundantly named console made cameo during the Game Awards, getting a late 2020 date in the process. Thankfully, MS’s head of Xbox Phil Spencer is back with some honest to goodness specs. "Xbox Series X is our fastest, most powerful console ever, designed for a console generation that has you at its center," Spencer writes.

  • Bloomberg

    Does This Investment Make Me Look Good?

    (Bloomberg Opinion) -- One of the trendiest ideas in finance is something called “social impact investing,” which is the idea that people should put more money into socially beneficial companies and products, and less into socially harmful ones. That hardly sounds objectionable, but I am skeptical about how much good social impact investing can do.The first risk is that social impact investing will be used to “whitewash” various harmful policies. By divesting from a particular set of companies, an investment fund loses at most a very small benefit from an additional degree of broader market diversification. The fund still is likely to earn the market rate of return on its other investments, and in the meantime it can claim virtuousness. At the same time, the funds can pursue socially harmful policies elsewhere: investing in companies that lobby for tariff protection, say, or emit less visible forms of pollution, or how about refined sugar?A second risk is that social impact investing simply redistributes wealth from investments — maybe to less socially conscientious individuals. Imagine a socially conscious investment firm that declines to participate in the initial public offering of a company that pollutes the ocean. That might create downward pressure on the price of the IPO. But there is a problem: The value of the actual investment has not declined, so at a potentially lower IPO price other investors will step in to fill the demand. In fact, those investors may have the chance to buy at a discount and earn a higher return than otherwise.The net result is that conscientious investors have missed out on a profitable opportunity, while less socially aware investors have earned more. Over time, the less socially aware investors will become richer, and their greater wealth may translate into greater political and economic influence.Maybe this effect isn’t large, but it is negative, and it will become correspondingly larger to the extent social impact investing becomes more popular (in 2018, the money pouring into sustainable investment funds quadrupled, rising to about $21 billion). That doesn’t sound like an appealing trade-off.But put that worry aside and assume that social impact investing simply makes it easier to get a solar power company off the ground with an IPO or an expansion. It’s still not clear that much has been gained. At that late point in the process, the company will succeed or it won’t, no matter what the socially conscious funds do.If anything, it would be more useful to have socially conscious research and development at the very early stages of projects. To some extent there are such investments, and I am more sanguine about being conscientious then than when companies already exist and funds are making investment decisions.It is also difficult to monitor the performance and social efficacy of the funds focused on doing good. In actively managed sustainable equity funds, for example, the most commonly held stocks are estimated to be Microsoft, Alphabet, Visa, Apple and Cisco. I have nothing against those companies, but you have to wonder exactly how much social improvement those investment funds are buying.Norway’s fossil fuel divestment is well-publicized. Less well known is that it exempted Shell and Exxon. There simply aren’t clear benchmarks for which investments to avoid, and of course some critics will portray technology companies as the embodiment of evil.Too many of the empirical arguments for social impact investing stem from a single example: South Africa under apartheid. In that case, a coordinated campaign of divestment and international economic and social pressure did hasten the end of apartheid, all for the better. But most sanctions are not very effective at achieving their stated political goals, or their effectiveness may be unclear. South Africa may have been a special case because it was relatively small and isolated, and because so many South Africans had ceased to believe in apartheid.Investment in socially beneficial activities can be worthwhile. But it ignores the question of who decides what is “beneficial,” and it is yet another example of how politics and media are becomingly increasingly performative. Everything is about looking good instead of substance. It is increasingly difficult for businesses and investment funds to perform their proper work under the glare of perpetual debate and periodic condemnation.The notion of extending that same glare to economic investments makes is hardly reassuring. I’ve yet to see a conception of social impact investing that I find convincing.To contact the author of this story: Tyler Cowen at tcowen2@bloomberg.netTo contact the editor responsible for this story: Michael Newman at mnewman43@bloomberg.netThis column does not necessarily reflect the opinion of Bloomberg LP and its owners.Tyler Cowen is a Bloomberg Opinion columnist. He is a professor of economics at George Mason University and writes for the blog Marginal Revolution. His books include "Big Business: A Love Letter to an American Anti-Hero."For more articles like this, please visit us at now to stay ahead with the most trusted business news source.©2020 Bloomberg L.P.

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