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MSFT getting killed today

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  • User profile image
    cbae

    Down over 4%. To add salt into the wounds, the stocks of just about every major, publicly-traded software vendor (ORCL, SAP, IBM, CA, INTU, VMW, CTXS) are trading near their 52-week highs.

  • User profile image
    spivonious

    @cbae: Short-term stock prices are meaningless.

  • User profile image
    Ray7

    @spivonious: They are meaningless.

    But this isn't a short-term problem; Microsoft's stock price has bobbed at around the same level for years. 

    Although the company has announced a cracking set of quarterly figures, the underlying problem is still present: no convincing strategy for future growth.

    In 1997, Jobs stood went on stage and thanked Bill Gates for the 13-million stock buy that did little but give the market confidence that Apple could limp along for a while longer.

    And now, with the announcement of the latest figures, Apple has effectively toppled Microsoft from the top of the industry. 

    Microsoft net falls below Apple as iPad eats into sales

    Apple is now more profitable than Microsoft

    The Final Shoe Drops

    No, I don't think think this is a short-term problem. I think that many investors took advantage of MS's figures and decided to get out while they could.

     

     

  • User profile image
    Cream​Filling512

    They should just buy back all their stock and become a private company.  Screw corporate law.

  • User profile image
    ScanIAm

    , Ray7 wrote

    And now, with the announcement of the latest figures, Apple has effectively toppled Microsoft from the top of the industry. 

    The top of what industry?  At best, they have a larger market capitalization in 'Technology' which is meaningless when you consider that it isn't actual money.

    That's like saying AOL was worth what every buyer in the last 3 decades paid for it Smiley

     

  • User profile image
    Cream​Filling512

    @ScanIAm:

    Pretty sure IBM makes more than Apple and MSFT combined.

  • User profile image
    cbae

    , Cream​Filling512 wrote

    @ScanIAm:

    Pretty sure IBM makes more than Apple and MSFT combined.

    Are you talking about top line or bottom line? Regardless, you're wrong on both counts. Apple and Microsoft individually make more on the bottom line than IBM does.

    Apple did $24.67 billion top line in the most recent quarter, while IBM did $24.61 billion, so now IBM doesn't even make more revenue than Apple does.

  • User profile image
    Cream​Filling512

    @cbae:

    Well, IBM made $100 billion last year, Apple+Microsoft made $127 bil combined.  Still that's a pretty big difference.

  • User profile image
    cbae

    , spivonious wrote

    @cbae: Short-term stock prices are meaningless.

    OK, look at the medium term. On average, any NASDAQ-traded stock outperformed MSFT over the past year.

    I can't think of any other situation in which a company has performed the way Microsoft has in the midst of a rising broader market, while the stock has languished. When there's this much disconnect between the actual performance of a company and the performance of its stock, there is something clearly wrong.

  • User profile image
    cbae

    , Cream​Filling512 wrote

    @cbae:

    Well, IBM made $100 billion last year, Apple+Microsoft made $127 bil combined.  Still that's a pretty big difference.

    IBM did $100 billion in revenue in the past year with a workforce of 436,000.

    Microsoft did $67 billion in revenue in the past year with a workforce of 89,000.

    Apple did $87 billion in revenue in the past year with a workforce of 46,000.

    Microsoft does "merely" 67% of IBM's revenue with less than 1/4 of IBM's workforce.

    Apple does "merely" 90% of IBM's revenue with around 10% of IBM's workforce.

    Combined, they did $154 billion in revenue in the past year.

     

  • User profile image
    DeathBy​VisualStudio

    Yet another thread where the possibility of Microsoft being in trouble is in doubt... Even if the Microsoft decision makers think their strategy is ok I really hope they at least entertain the idea that the PC market is changing and they are in trouble. It just seems like Microsoft in gerenal plugs it's ear signing "lalalalala I can't hear you" and continues to repeat the same mistakes it has in the past. Microsoft needs to be the company that completes the vision in their 2019 video rather than the company that just makes the parts and says "now you put them together".

    BTW it seems as though the Insert Video feature here isn't working.

  • User profile image
    brian.​shapiro

    @cbae:

    Microsoft isn't near its low at all, not even its one year low.

    But if you expect it to go even lower, you should watch the stock, because it would be a good buy.

  • User profile image
    ScanIAm

    , cbae wrote

    *snip*

    IBM did $100 billion in revenue in the past year with a workforce of 436,000.

    Microsoft did $67 billion in revenue in the past year with a workforce of 89,000.

    Apple did $87 billion in revenue in the past year with a workforce of 46,000.

    Microsoft does "merely" 67% of IBM's revenue with less than 1/4 of IBM's workforce.

    Apple does "merely" 90% of IBM's revenue with around 10% of IBM's workforce.

    Combined, they did $154 billion in revenue in the past year.

     

    That's the problem with comparisons like this, the numbers don't give you any more information than what they specifically state.  If you choose to use that as a yardstick, then fine, but a whole lot of folks were using numbers like this to justify real estate a few years ago.

    Other than insider trading, most stock trading is 1% skill and 99% voodoo.  We just don't like to think that it's voodoo so we try to turn it into a game with 'scores' and 'stats'.  If that makes you feel better about your decision to buy or sell MSFT, then good for you.  I'm willing to bet that there was someone just as sure that APPL was going to die back in the 90s...

    That said, MSFT does a lot more business with businesses than AAPL and many of these businesses are hoarding cash until they know how the economy will turn out.  Consumers are anxious about the economy, too, but anxious consumers look for distractions from anxiety like iProducts provide.

    As a side note, MSFT has ∞ more revenue than either IBM or AAPL in the console market...

  • User profile image
    BitFlipper

    My feeling is still that MS should give up relying only on OEMs to complete its "vision", because OEMs keep doing a poor job on hardware. MS should create a line of phones and tablets so that they can control the end-to-end process (just like Apple does), while still licensing the OS to any OEM that wants it.

    Then the OEMs will have a reference design that they can copy or try to improve upon. Those OEMs that then still choose to release half-hearted efforts resulting in sub-par hardware will then have no more excuses. Maybe MS can even license the HW designs.

    I know that the software is there (SL + XNA + Unified App Store, VS + Blend, run on x86 + ARM since .Net apps are portable), or at least very close to being there, and from what I can gather, the new "Immersive Tablet UI" is a step in the right direction. But I am so tired of hardware from OEMs that just doesn't interest me, and does nothing to make anyone excited (especially the influential tech blogsphere with their short attention span and their gushing all over iBaubles).

    And this line of phones and hardware should be simple - maybe just 1 phone and two tablets (slate + convertible). Creating too many versions just dilutes the whole thing again. I think given MS's resources, they can create some slick hardware that people can actually get excited about. It is clear that Apple found a cash-cow. There's no reason MS can't do the same but the OEM-only approach is never going to make this work.

    As far as this raising anti-trust issues - the anti-trust oversight is just about to expire, and in addition I really fail to see how this can trigger any anti-trust issues in the first place since MS is way behind in both phone and tablet marketshare at this point.

  • User profile image
    spivonious

    nevermind, I should read complete posts before replying. Smiley

  • User profile image
    Ray7

    , ScanIAm wrote

    *snip*

    The top of what industry?  At best, they have a larger market capitalization in 'Technology' which is meaningless when you consider that it isn't actual money.

    That's like saying AOL was worth what every buyer in the last 3 decades paid for it Smiley

     

     

    Larger capitalisation, larger profits even though they have smaller margins, a better grasp of the consumer market and mindshare.

    The share price is just the icing on the humble pie. 

  • User profile image
    Ray7

    , brian.​shapiro wrote

    @cbae:

    Microsoft isn't near its low at all, not even its one year low.

    But if you expect it to go even lower, you should watch the stock, because it would be a good buy.

    Not if you're investing long term. It hasn't moved in years.

     

  • User profile image
    Bass

    Microsoft is no in danger of bankruptcy or anything absurd like that.

    But they haven't, for the past decade, been able to increase their company value (market capitalization) by even minor amounts. Basically the Microsoft of 2000 is considered as valuable as the Microsoft of 2011 (not adjusting for inflation even).

    Meanwhile Microsoft's profits and revenue grew a lot in the past decade. But for whatever reason, investors big and small don't think Microsoft is a valuable company. This baffles me personally, I am not entirely sure it's because of a lack of vision.

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