Cases In Corporate Finance Business & Marketing Case Study

Cases in Corporate Finance
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Executive Summary
Microsoft Corporation acknowledges customer, supplier and global diversity. The company is continuously working on creating and developing an effective business model that will foster greater levels of diversity in the base of their operations. The organization divides its customer segments into commercial clients and general customers. Its channel of service is online. Moreover, it classifies its revenue into three major divisions, namely; the Intelligent Cloud, Productivity and Business Processes and Personal Computing. Some of the specific products that the corporation offers include operating systems such as Windows 10, Windows 1 mobile, Windows Mixed Reality, Windows 8.1, Windows 7, Windows Server and Internet Explorer Search Engine (Microsoft Corporation, 2016). In terms of office software, the organization provides Office for Home, Office 365 for Business, Outlook, OneDrive, Word, Excel, PowerPoint and Office for Android. Some of the company's devices are Azure Kinect DK and Microsoft Surface Hub, among others.
Microsoft Corporation uses a divisional kind of management. Although its original structure was the most functional one, in June 2015, the senior management stated that the firm would undergo numerous changes in its management. The aim of the shift was to focus on increasing the productivity and the servicing element of the company. Therefore, according to the restructuring initiative, and as illustrated in the chart below, the organization classifies its leadership in terms of engineering and operations or business functions. In the first section, the firm has three divisions, whereas on the basis of business functions, there are nine divisions. In the new composition, all engineering groups answer to Satya Nadella, the CEO, on matters of new product development and innovations. Some of the advantages of the divisional structure is that the organization gives more focus to customers, cross-product coordination is easier and also provides a swift monitoring of employees.
center145547CEO, Satya Nadella00CEO, Satya Nadella
292133041636200
61751694851060047026291288470078377117628380752214072300right387581Business FunctionsBusiness Functions
-54626628063700-53439029259500left758700left102243Engineering GroupsEngineering Groups
-49876529945600592578620445400right12065Business DevelopmentBusiness Developmentleft11355Cloud and AI GroupCloud and AI Group
39188524649400left23506500left6350Experience and DevicesExperience and Devicesright6350Corporate External and Legal AffairsCorporate External and Legal Affairs
right3010480059257872306860000Artificial Intelligence and ResearchArtificial Intelligence and Researchright14473Corporate Strategy and Planning Corporate Strategy and Planning
593766128504800right8890Finance GroupFinance Group
right422580Human ResourceHuman Resource
592578621976800left28130Worldwide Commercial BusinessWorldwide Commercial Business
11756571627100
232756438150300-1759052394100left177850Marketing GroupMarketing Groupright225310LinkedInLinkedIn
Capital Structure of Microsoft Corporation
Equity Capital
Equity capital is basically the amount of money that an organization pays its shareholders after liquidating all the assets and shares, and settles all of its debts. As of September 30, 2019, the quarterly equity of the shareholders of Microsoft Corporation was $106.1 billion. The amount accounted for $78.9 billion regular stock and capital given at $.00000625 average count for a share, and $27.2 billion commission. On December 31, 2018, the company’s net equity was $92.1 billion followed by $78.4 billion in the previous year and $68.8 billion in 2016 (Microsoft Corporation, 2016). This shows that the company has issued more shares, and this is because of the increase in its retained earnings. In the 2017 fiscal year, Microsoft bought buybacks worth $10.2 billion and spent $12 billion on profits. In 2019, the company repurchased $16.8 billion shares and spent $14.1 billion on dividends (Microsoft Corporation, 2019).
The table below shows the annual total equity capital data for Microsoft Corporation from 2015 to 2019.
YEAR

AMOUNT

2019

$102.330 million

2018

$...