Beware the lure of big numbers. On the face of it, Microsoft’s decision to boost its share repurchase programme by $16bn looks like further action to sharpen up its monstrously inefficient balance sheet.

In reality, it is not new money for shareholders. Microsoft’s Dutch auction tender offer only attracted takers for $3.8bn of the $20bn target. It has rolled the remaining $16.2bn into its existing share repurchase programme – meaning it will now buy back $36bn over five years. Although that is a huge number, it will have no discernible impact on Microsoft’s hoard of roughly $40bn in net cash and investments. After all, Sanford Bernstein expects annual cash flow of about $10.5bn – after dividends and capex – in the coming years.

The Dutch auction provides a short-term floor for Microsoft’s shares at $24.75 (the top end of the auction range). But, by in effect leaving the cash pile intact, Microsoft has not solved the investment conundrum of whether to treat Microsoft as a growth or value stock. Serious questions remain over the group’s ability to grow rapidly. Meanwhile, potential value investors are scared off by the risk the company will spend aggressively in the pursuit of elusive growth, rather than returning cash to shareholders. Ramping up the dividend – currently generating a 1.5 per cent yield – would be a painless way of starting to reassure the latter.