Next to artificial intelligence (AI), stock splits have been Wall Street's hottest trend.
A stock split allows a company to cosmetically alter its share price and outstanding share count without any effect on its market cap or underlying operating performance. Following over a dozen big-time stock splits in 2024, a trio of brand-name businesses have followed suit this year.
However, few companies can match the success, or sheer number of splits, software behemoth Microsoft (MSFT 1.58%) has brought to the table.
Image source: Getty Images.
Breaking down Microsoft's stock-split history
Microsoft made its debut as a public company on March 13, 1986, at an initial public offering (IPO) price of $21 per share. In the 39 years that have followed, it's completed nine stock splits:
- September 1987: 2-for-1
- April 1990: 2-for-1
- June 1991: 3-for-2
- June 1992: 3-for-2
- May 1994: 2-for-1
- December 1996: 2-for-1
- February 1998: 2-for-1
- March 1999: 2-for-1
- February 2003: 2-for-1
A single share purchased on March 13, 1986 for $21 would have grown to a cumulative 288 shares, worth $141,710 (not including dividends), as of the closing bell on July 1, 2025.
Microsoft may be poised for its 10th forward split
Although access to fractional-share purchasing has reduced the urgency for companies to complete forward splits, Microsoft's meaningful share ownership by everyday investors, who hold 34% of its outstanding shares, and nominally high share price of $492.05, may coerce its 10th split sooner than later.
Microsoft stock has benefited immensely from its aggressive investments in cloud computing and AI. Cloud infrastructure service platform Azure is No. 2 globally by spending -- a 23% share in the March-ended quarter, per Canalys -- and could see its sales growth reaccelerate as generative AI solutions are integrated into the platform.
Don't overlook its legacy operations, either. While the growth heyday for Windows and Office is long gone, Microsoft's high-margin legacy segments generate boatloads of cash flow that it can use for high-growth initiatives, such as AI investments, stock buybacks, or its ever-growing dividend.
