Posted on 05/17/2013 11:51:24 AM PDT by SeekAndFind
At first glance, things could not be going worse for Microsoft.
Its long-dreaded nightmare scenario is playing out. The PC industry as we've known it is collapsing. PC sales fell 14% in the first quarter, according to IDC, the worst ever drop in history.
Microsoft's new Windows 8 operating system is accelerating the collapse, says IDC. The new tile-interface is scaring consumers. Microsoft is scrambling to fix Windows 8 to address these concerns. And even if Microsoft fixes Windows 8, it could be too late.
Its biggest rivals — Apple and Google — have taken complete control of the next major computing platforms. Apple owns tablet computing and a big chunk of smartphones. Google owns most of smartphones.
[SNIP]
Microsoft's normally listless stock has seen all of this terrible news and made a sharp move, soaring 26% this year, reaching a five-year high. Wait. What?
That's right, Microsoft is trading just over $34 a share right now, despite the fact that the worst fears for the Windows franchise have been confirmed.
What gives?
For the longest time, the destruction of Windows has been hanging over Microsoft's head. Now that it's here, and really, it's not so bad, investors seem to feel better about the company.
(Excerpt) Read more at businessinsider.com ...
HERE’s THE REASON:
Last quarter, Microsoft reported $18.8 billion in revenue, an 8% increase year-over-year. Its Windows division did $4.6 billion in revenue, which is about flat year-over-year.
(These revenue numbers are non-GAAP. They exclude Windows upgrade revenues counted in the quarter.)
The Windows business is flat, despite the overall PC market falling, because Microsoft’s Surface tablet, plus licenses to businesses made up for the shortfall. Microsoft’s Windows business also isn’t entirely tied to consumer PC sales anymore. It sells to corporations in multi-year deals.
The reason Microsoft’s overall revenue grew is that it’s now a diversified business. While CEO Steve Ballmer has regrettably repeatedly emphasized the importance of Microsoft’s consumer businesses, the truth is that Servers and Tools, and the Business Division (home to the Office productivity suite) are driving Microsoft these days. Servers and Tools was up 11%. The Business Division was up 8%.
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Spin. The tile interface is not “scaring” consumers.
The tile interface is NOT WANTED by consumers.
Why can’t anyone in media report truthfully about ANYTHING anymore.
It may be imploding however, it still has a vast majority of the market share and still is reporting billions upon billions in earnings and have even more billions in cash on hand with no outstanding debt. They also pay a decent dividend.
If anything, MSFT stock is too low.
Why? Cash.....Microsoft has tons of it...enough to buy any mindshare they need.
I'm definitely not shilling, I wouldn't take a MS phone if you gave it to me for free, just guessing how investors might be reading the market.
MS is about enterprises. And they still are the big name there.
And I suspect when businesses start doing away with their desktops and laptops in favor of tablets, they will be Surface tablets that are compatible with their legacy business applications.
But Nokia and Apple OWNED the next major computing platform, though smartphones and candy bar phones...
I love how these reporters make assumptions that never ever play out in real life.
No bias here or nothing. Oh, and absolutely ZERO mention of servers. Fact is that Apple and Google can't (immediately) compete with MS Server OS.
And for the love of God, the PC IS NOT DEAD! There will ALWAYS be a need for a desktop. Tablets and phones are not going to replace desktops/laptops any time soon.
No question, yes.
Windows 8 will do fine after a couple minor tweaks.
In windows 8.1:
They will bring back the start button in desktop mode.
They will also let the computer boot into desktop mode.
Those 2 minor fixes will get rid of 95% of the complaints.
The actual OS is great.
Just as COBOL isn't dead. Sure there will still be those who need PCs, but for most, tablets will do.
Anybody who does any work isn’t doing it on phones.
I have two sons-in-law that are crazy fanatic computer geeks that carry around there tablets damn near everywhere. But they will not give up their desktops either.
People aren’t buying because too many are out of work or are feeling the financial crunch brought on by excessive government and overspending. Not because the market has changed and they are walking away from desktops.
I can’t think of one application the tablet actually does better. Laptops are far more functionality, including portability.
Also, desktops and laptops from 3 or 4 years ago are still “good enough”. They still do what people need them to do, no need to upgrade constantly to keep up like before.
Main reason: $85 billion of QE every month. The money has to go somewhere.
I challenge you to go into any mid- to large-sized business in your local area and find more than a dozen employees whose sole computing platform is a tablet. You’ll be looking for a while. I’ll save you the trouble, it doesn’t exist.
Tablets are SUPPLEMENTAL computing platforms. They’re still at least a decade away from being utilitarian for computing if for no other reason than price. PCs and laptops are much cheaper for purchase, repair, and parts. You can’t do anything but stock “spare” tablets, but most companies with whom I’ve consulted don’t do that. You break your tablet, you buy yourself a new one. Period.
Ha! I still use a desktop from 2000 in my recording studio to run winamp and Sonar for recording, playback and rehearsal. It hasn’t been plugged into the internet for going on six years now. It runs win2000pro nicely. Still.
Not now, sure...but give it two or three years, I think you will see it....that’s why Windows 8’s problems aren’t that big of a deal in the big picture......they are just working out the kinks right now, they’ll eventually get it right when it’s time for enterprises to make the move.
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