Did Microsoft make $18 billion on Apple stock?

So, I'm agonizing over whether to ditch my PC and buy a new iMac - and return to the Mac world I left when we launched MarketWatch.

Just about the same time, Microsoft's Bill Gates told a MacWorld conference in Boston his company would buy $150 million worth of Apple stock. 

That would have been a multi-billion dollar smart move.

Apple shares were then selling at $5.43 a share.  They closed Friday at $122.06.  The potential gain on the shares:  $18.1 billion.

By comparison, if Microsoft spent the same money on its owns shares, then selling at $17.67 and closing at $28.25 Friday, the gain would have been (only) $89.8 million. (Click on the graphs for bigger pictures)

In this case, clearly, the adage that entrepreneurs should bet on themselves wouldn't have paid off.  Unless you're Steve Jobs, who just cashed in 120,000 options with a strike price of about $5 - which were set to expire.  Exercise 'em or lose 'em.  Jobs did the right thing, and may have profited about $15 million.

Comments

[Vince]

This is a fairly old article, but there is a recent link to it , so I thought I'd chime in.

The potential gain I came up with, considers the 2005 stock split that I believe occurred before this article.
That would be a cool 36+ Billion dollar gain.
Now if they sold it at the 200 dollar peak, well, thats more money than anyone I hang out with,

[Shawn King]

It would have been a smart move - had MS not sold it shortly afterwards....

[Frank Barnako]

David ...

Frankly, while I've been noodling about the hardware (value vs similar PC) the iMac presentation with the iLife Update is what's pushing me over the edge. The new Garage Band really looks interesting, and I've played a bit with movie editing and I think the new iMovie is probably just the ticket to send me into an incredible time sink black hole of fun :)

I am, however, likely to hold off til October and the release of the next OS - to get it all at once. There's no pressing need for the new hardware now.

Frank

[David A. Porter]

Frank,

I have been wondering the same thing. I have never even considered a MAC. But now that I don't own a business with networks and lots of people, the paradigm changes.

I am also finding that a Mac might offer me more tools regarding photography and music.