Yeah...microsoft is doing justtttttttt fineeeeeeeeeeee

http://news.slashdot.org/news/08/09/23/1816233.shtml

Their shares are low now arent they? Seems like simple buy low, sell high rule.

Yup. It's just good business :)

No, they are in trouble because of xbox 360, and are panicking...sorry...I was briefly possessed by a PS3 fanboy spirit...lol!

Good move.
MS shares are being diluted hard and fast, so they need to do that quickly.
I remember when they had more than $60 billions in the bank (some people stuck 5 years ago still believe this), but the article states they have $23.7 billions left, because they already bought back billions of their shares.
In the current economy, when you don't know what to do with your money because you can't innnovate, the money in the bank will just lose value with the economy going down. It makes more sense to rely on debt (tresor bonds?) nowadays, at least in the US.
Notice this new buy back plan can deplete their cash reserve entirely.

I dont like mircosoft but I bought some of their stock today.

The BBC article states that it will be drawn out until 2013, so it isn't as big of news as it is over 5 years, or 5bn per year. But with stocks dropping 30% according to the article, the board members won't be happy because their value dropped 30% as they are the biggest share holders. Doing this will inflate stock value because it creates demand and there will be less shares going around so everybody is now worth more money.

I banged my head against the table today for not buying Nintendo stock when I knew it would go up around the time I got my wii >

Dude, I don't personally know you, and I'm not saying you're ignorant, but the comment above is very ignorant, in the truest sense of the word.  A $40 bln stock buyback over 5 years is massive, by any measure.  Consider the market cap for Sony and Nintendo, and look at M$ commitment to reassure large sharholders that the company is in it to deliver.  In 2013, people holding M$ will be very happy...

Its just to raise the PE ratio to their earnings per share look more impressive ....... securities valuation and analysis anyone? =]