In a staggering turn of fortune, former Microsoft CEO Steve Ballmer is poised to receive an astronomical $1 billion in annual dividends from the tech giant, cementing his status as the sixth richest person globally. Ballmer, the largest individual shareholder in Microsoft, holds approximately 4% of the company, translating to a staggering 333.2 million shares.
The value of his significant stake has skyrocketed to around $130 billion, witnessing a remarkable $44 billion surge in wealth in the current year alone. This surge is attributed to a phenomenal 56% rise in Microsoft’s stock price.
Ballmer’s anticipated annual dividend serves as a substantial addition to his already substantial wealth. Having joined Microsoft as its 30th employee in 1980, he steadily accumulated a significant stake before assuming the role of CEO in 2000. Ballmer relinquished the CEO position in 2014 but remains a key figure in the company’s ownership landscape.
His current wealth positions him on the cusp of becoming the fourth richest person globally, trailing behind only Larry Ellison and his former boss, Bill Gates.
In the year 2023, Microsoft paid $2.79 per share in dividends, resulting in an annual payment of approximately $930 million to Ballmer based on his ownership. Looking ahead to 2024, Microsoft has increased its dividend by 10%, reaching $3 per share. This adjustment projects a potential annual dividend of close to $1 billion for Ballmer.
However, it’s worth noting that Ballmer may be subject to a 20% tax on dividends for individuals earning over $500,000 annually, potentially translating to around $200 million in taxes on the dividends received from Microsoft.
In contrast, Bill Gates, since stepping down from Microsoft, has strategically diversified his wealth away from the company, opting for a mix of cash and other public equities. Gates, who once held around 4% of Microsoft in 2014, now maintains just over 1% ownership in the software giant after a series of divestitures.
As Microsoft continues its trend of increasing dividends for 18 consecutive years, Ballmer’s annual payout is expected to surpass $1 billion in 2024 and continue its upward trajectory.
