Microsoft Announces Share Repurchase Program and Increases Quarterly Dividend

REDMOND, Wash. — September 22, 2008 — Microsoft Corp. today announced that its board of directors approved a new share repurchase program authorizing up to an additional $40 billion in share repurchases with an expiration of September 30, 2013.

The board of directors also declared a quarterly dividend of $0.13 per share, reflecting a two cent or 18 percent increase over the previous quarter’s dividend. The dividend is payable December 11, 2008 to shareholders of record on November 20, 2008. The ex-dividend date will be November 18, 2008.

In addition, the company stated that it has completed its previous $40 billion stock repurchase program. Microsoft has returned over $115 billion to shareholders through a combination of share repurchases and dividends over the last five years.

“These announcements illustrate our confidence in the long-term growth of the company and our commitment to returning capital to our shareholders,” said Chris Liddell, chief financial officer of Microsoft.

Microsoft also announced that its board of directors has authorized debt financings from time to time of up to $6 billion. Pursuant to the authorization, the company has established a $2 billion commercial paper program. Microsoft intends to use the net proceeds from any debt financings for general corporate purposes, which may include funding for working capital and repurchases of stock.

The company received corporate credit ratings of AAA and Aaa by Standard & Poor’s Rating Services and Moody’s Investors Service Inc., respectively. The commercial paper is rated A-1+ by Standard & Poor’s and P-1 by Moody’s, the highest ratings available from both agencies.

“The company’s strong credit quality coupled with investors’ current appetite for high quality paper provides a unique opportunity for the company to establish its first-ever commercial paper program and enhance its capital structure,” said George Zinn, treasurer of Microsoft.

Founded in 1975, Microsoft (Nasdaq “MSFT”) is the worldwide leader in software, services and solutions that help people and businesses realize their full potential.

This press release does not constitute an offer of any securities for sale. The commercial paper notes to be issued by Microsoft have not been and will not be registered under the Securities Act of 1933, and may not be offered or sold except in reliance upon an exemption under the Securities Act.

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