Interest comment by David Einhorn, legendary investor…

We wanted to share some thoughts on Microsoft, which we closed during the quarter. We believe that we purchased the shares at an attractive time, and for a good while the investment worked nicely. As has been our habit of late, we overstayed our welcome as the shares peaked after the company announced a very good September 2007 quarter.

Since then, management has acted in an overaggressive and almost panicky fashion regarding its online offering. First, it sought to acquire Yahoo! and then after that failed, it announced extremely high internal investment requirements to pursue this “huge” opportunity (read: “Google-envy”). We doubt the opportunity is what they say it is and wish MSFT focused on its core strength: software.

The CEO is a very smart and very wealthy man. Perhaps, he is so wealthy that he has bigger ideas and aspirations than making MSFT’s shareholders wealthier. We’ve given up on MSFT for now as we feel better investing in companies where management at least appears to be trying to work for shareholders.