Microsoft sees shares tumble 11%

Software giant Microsoft saw 11% wiped off its value on Friday after investors showed disappointment with third quarter earnings announced on Thursday

http://news.bbc.co.uk/1/hi/business/4955562.stm


Looks like not a good news for Microsoft.....

I'm honestly not surprised by this... I mean Vista is delayed, and Microsoft has no shippable products up in the near future (none that turn a profit anyway).

I expect to see Microsoft have a awful year and then for it all to turn around as Vista ships... Plus as an added bonus as Vista ships you will also have Microsoft Office 2007 ship.

If Microsoft are really worried they could release Office 2007 before Windows Vista.

It has nothing to do with low sales. Microsoft keeps having record profits. It's just that is was below the expectations. Low sales and "not as much as we wanted" are 2 different things

blatzcoder wrote:

BBC wrote:The firm said net profits in the first three months of 2006 were $3bn (£1.7bn),16% rise on the same period a year ago, but below expectations. That wiped $30bn off the stock market value of the company in a single day.

Maybe they should get some help from Exxon or Mobil. They had record profits over the past few months.

That wiped $30bn off the stock market value of the company in a single day.

More than 50% of the firm's income came from its Windows operating system and its Office business software suite.

But Vista - the first major update since Windows XP was introduced five years ago - will not be launched until 2007, instead of the second half of 2006 as planned.

Until then, Microsoft will be relying on sales from its Xbox games console and SQL database software to help bolster revenues.

What happened to IE, DSK Search and other money spent on competing with GOOG/YHOO....

I think Microsoft should stop competing and get that Vista out first, put all the developers in a closet and fix the damn thing to release it before the holiday season....

Under-promise and over-deliver: will exceed customers' expectations by giving them more than what they can think of....

Harlequin wrote:

It has nothing to do with low sales. Microsoft keeps having record profits. It's just that is was below the expectations. Low sales and "not as much as we wanted" are 2 different things

What by bundling OS with new computer and not allowing customers to buy a computer/laptop with no OS on it. That make sense, they make money on every damn computer sale. you know why.... consumers can't buy a PC without Windows...

I tried to order a Dell desktop with no OS on it they denied saying you got to have Windows on it XP Home atleast, that sucks.......

arunpv wrote:

Harlequin wrote:It has nothing to do with low sales. Microsoft keeps having record profits. It's just that is was below the expectations. Low sales and "not as much as we wanted" are 2 different things

What by bundling OS with new computer and not allowing customers to buy a computer/laptop with no OS on it. That make sense, they make money on every damn computer sale. you know why.... consumers can't buy a PC without Windows...

I tried to order a Dell desktop with no OS on it they denied saying you got to have Windows on it XP Home atleast, that sucks.......

damn double post again....

blatzcoder wrote:

BBC wrote: The firm said net profits in the first three months of 2006 were $3bn (£1.7bn),16% rise on the same period a year ago, but below expectations. That wiped $30bn off the stock market value of the company in a single day.

Maybe they should get some help from Exxon or Mobil. They had record profits over the past few months.

You don't happen to have a chip on your shoulder?

arunpv wrote:

Harlequin wrote:It has nothing to do with low sales. Microsoft keeps having record profits. It's just that is was below the expectations. Low sales and "not as much as we wanted" are 2 different things

What by bundling OS with new computer and not allowing customers to buy a computer/laptop with no OS on it. That make sense, they make money on every damn computer sale. you know why.... consumers can't buy a PC without Windows...

I tried to order a Dell desktop with no OS on it they denied saying you got to have Windows on it XP Home atleast, that sucks.......

Hi Beer, using that old chestnut again.

Is it my imagination or is Dell not the only place to get PC's from? And that Apple store must be a figment of my imagination aswell [A]

arunpv wrote:

Software giant Microsoft saw 11% wiped off its value on Friday after investors showed disappointment with third quarter earnings announced on Thursday

http://news.bbc.co.uk/1/hi/business/4955562.stm


Looks like not a good news for Microsoft.....

Many interpretations.  Here's another view
http://articles.moneycentral.msn.com/Investing/CNBC/Dispatch/060428markets.aspx

Spending ramp-up slams Microsoft shares

Microsoft tumbled more than 11% this afternoon after the software giant announced after the bell Thursday that it had come in light on earnings and revenue for its fiscal third quarter; it also guided lower than analysts expected for the 2007 fiscal year.

The company said it earned 29 cents a share in the third quarter, including 3 cents a share for legal charges. Excluding the legal charges, Microsoft earned 32 cents a share, in line or slightly lower than estimates. Revenue was $10.9 billion, up 13% from a year ago but lower than the consensus analyst estimate of $11.04 billion. (Microsoft is the publisher of MSN Money.)

The company said it expects revenue of $11.5 billion to $11.7 billion in the fourth quarter, up more than 14.5% from a year ago. The drubbing came from Microsoft's guidance for fiscal 2007: The company expects revenue of $49.5 billion to $50.5 billion with earnings between $1.36 and $1.41 a share. The consensus earnings estimate was $1.53 a share.

The results were "quite disappointing," software analyst Richard Sherlund of Goldman Sachs told CNBC's "Squawk Box."

Analysts were excited about the prospect of strong revenues in 2007 generated by new products, but then Microsoft blindsided them by saying it will spend $2 billion more than everybody thought, Sherlund said. The spending will likely be an effort to compete with Google (GOOG, news, msgs) and Yahoo! (YHOO, news, msgs), he said.

This morning, CIBC World Markets cut the stock two levels to "underperform" from "outperform," Lehman Bros. downgraded the stock to "equal weight" from "overweight," and Morgan Stanley cut shares to "equal weight" from "overweight." Additional downgrades came from Canaccord Adams (from "Buy" to "Hold)") and Caris & Co. (from "Buy" to "Above Average").

[Double post]

Yea... Exxon's earnings posted $8.4 billion this quarter and $10.7 billion for the previous one. Profit wise, these oil companies could eat all of Microsoft for lunch.

Now talk about corporate power.


Regards,
Vincent

[Double post]

Sampy wrote:

Throwing more developers or more money at Vista isn't going to make it come out any faster. In fact, more devs would probably slow it down.

Although if they threw more money at you, I doubt you'd refuse it!

Sampy wrote:

We are not cogs in a machine or robots on an assembly line. There are ways to ensure that we hit deadlines and meet schedules but putting everyone on long hours and throwing more people at it isn't the way.

Thus saith the cog.

So they made zero dot something billion less revenue that expected, basically chickensh¡t in relation to the actual revenue, and people get stupid and make the share drop 11%? Did I get this right?

This is one of those times I wish I had more money in the bank because I'd be buying stock like mad when it gets this low.

Sampy wrote:

Throwing more developers or more money at Vista isn't going to make it come out any faster. In fact, more devs would probably slow it down.

We are not cogs in a machine or robots on an assembly line. There are ways to ensure that we hit deadlines and meet schedules but putting everyone on long hours and throwing more people at it isn't the way.

Why not, is Vista waiting for new year or something like that. More devs can share modules and finish the code sooner.
if 1 dev works on 2 modules he can share it with others then instead of getting it done in 1 week it will be done in 2-3 days.



Lets take an example.

Project : Customer service app
Screens : Entry screen, view screen and few small other screens

if I have 1 developers+1 tester I might finish in 10 days
if I have 2 developers+2 testers I might finish in 5 days

Am I doing the math correct?

What is weird is how MSFT is a vastly profitable company, generally speaking, but perceptions alter stock prices.  How good are MSFT dividends?  Those can make or break a stock...