Microsoft's Internet business is taking hits at the moment. A new report showed Google accounting for half of all Web searches for the first time in April, while Microsoft's share dipped to 11%. Then the New York Post reported that Microsoft's talks with eBay about an acquisition of the auctioneer have cooled off. Two weeks ago, eBay signed a big Internet advertising deal with Yahoo, as Microsoft switched MSN, a large conduit for Yahoo's ads, to its own ad engine.
Investors didn't get much succor on the issue of a share buyback, either. Microsoft has returned $87 billion to shareholders since 2001 in buybacks and dividends and still has $6 billion to go on a 2004 repurchase. But some are calling for an increase to $100 billion. Ballmer said only that Microsoft's $34.8 billion in cash "belongs to investors," whether it's kept in the company, paid in dividends, or used to buy stock. "We are not going to screw around with that," he said.