SEATTLE (Reuters) - Microsoft Corp Chairman Bill Gates and Chief Executive Steve Ballmer defended recent stock sales on Tuesday as they faced tough questions from shareholders frustrated by the lack of growth in the company's shares over the past decade.
Gates, who co-founded the company in 1975, sells 20 million shares every quarter to help fund his philanthropic activities, while Ballmer is planning to sell 75 million shares by year end for tax planning reasons.
"Both Bill and I retain very substantial interests in the company," said Ballmer, CEO since 2000, at the company's annual shareholders meeting, which was broadcast on the Web. "If you look at the amount of shares sold by insiders it's really a very small percentage of all of the shares that sell, it's not a material factor in the stock price."
More than 50 million Microsoft shares change hands most days on Nasdaq, sometimes more than 100 million. The company has about 8.6 billion shares outstanding.
Gates is still the largest individual shareholder with about 7.2 percent of the company, followed by Ballmer with about 4 percent. Gates regularly sells shares in batches of 1 million to 4 million to fund his $33 billion Bill & Melinda Gates Foundation, which became his focus when he retired from day-to-day work at Microsoft in 2008.
Asked by a shareholder if he could somehow annul his Microsoft shares, rather than selling them, Gates defended his priorities.
"I made that decision that wealth was going to go to the Foundation and the causes of the Foundation as opposed to being some reduction in shares outstanding for Microsoft," said Gates, in his only public utterance at the meeting.
Microsoft shares fell about 1 percent to $25.81 on Nasdaq. The shares are down about 15 percent this year, compared to a 9 percent gain in the Nasdaq. They are trading around the same level as 2002.
Reporting by Bill Rigby; Editing by Derek Caney