“Microsoft issued $13 billion of senior notes with various maturities to be used for general corporate purposes. Fitch expects Microsoft will use net proceeds mainly for stock buy backs given the company’s plan to complete the $17.9 billion remaining under the current $40 billion share repurchase authorization by Dec. 31, 2016.”
See Fitch Rates Microsoft’s Senior Notes Offering ‘AA+’It’s kind of embarassing to have to borrow money to pay debts… but that’s what M$ continues to do. It has $100 billion in liquid assets but it can’t repatriate them to USA without forking out a ton of money to Uncle Sam for taxes, so it borrows money at this end to pay for what it does day to day. The problem is chickens come home to roost. When the day inevitably comes that the world sees M$ has no clothes and that M$ is not the one true source of IT, the gravy train ends but the debts will have to be paid. At the last 10-Q quarterly report, M$ reported $36billion in short+long term debt. Now about half it’s liquid assets will be needed just to repay that debt.
Yes, the increasing debt to asset ratio is a sign of the end of monopoly. I find it interesting that rather than being conservative and staying debt-free when the sun shines on the empire, they’ve already decided the end is near and they will rob Peter to pay Paul (Fitch expects the money will be used to buy back shares to prop up the share-price) until the last moment, like some drunk/gambler/fool. They are issuing notes out as far as 2055. I wonder if they will be able to pay the bills long before that. Clearly, the cloud is growing for them but that desktop environment is endangered and the server environment faces stiff competition. Fitch’s rating assumes governments won’t force repatriation of the money and that the gravy train continues… What could possibly go wrong?
Meanwhile huge government departments are using their own clouds based on OpenStack and their own office suites based on LibreOffice and OpenOffice.org, any browser but Internet Exploder and yes, even desktop GNU/Linux. I find it amusing to think of this not just as the decline of a monopolist but its enslavement of itself just as it enslaved users for decades. Most slaves have to be captured but M$ is enclosing itself with debt willingly, seeing no other option. Cattle do what’s expected in the chute at the slaughterhouse but they don’t build the chute.