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Microsoft quarterly results reflect troubled PC market, middling Windows 8 launch

post #1 of 49
Thread Starter 
Microsoft this week announced its second quarter of fiscal 2013 earnings, revealing more than 60 million Windows 8 licenses sold. Industry observers, though, remain cautious on the software giant in light of trends in the PC sector.

Microsoft's Surface RT
Microsoft declined to provide sales numbers for the Surface RT.


The Redmond giant pulled in $21.5 billion in revenue for the quarter, with a profit of $6.38 billion, or $0.76 per share, up from $5.87 billion a year ago and $5.31 billion for the quarter previous. Of that figure, the Windows division accounted for about $5.9 billion in profit.

Despite the profit uptick, Wells Fargo senior analyst Maynard Um sees overall PC industry dynamics remaining difficult for Microsoft. In a note to analysts on Friday morning, Um noted that the enterprise sector is still largely moving to Windows 7 ? which surpassed Windows XP in install base last year ? and that consumer demand for Windows 8 remains soft.

On the consumer end, Microsoft is caught between a soft economy ? which hampers demand for new Windows 8-based machines ? and the rise of smartphones ? sectors dominated by Apple and Google's operating systems. These two trends have kept consumer PC demand soft, and Um doesn't expect any meaningful upward shifts in PC unit sales until Windows 8 units are able to hit lower price points.

With regard to Microsoft's own smartphone and tablet efforts, signs are mixed. Manufacturing partner Nokia, which has staked its future on the success of the Windows Phone 8 platform, moved 4.4 million Lumia units last quarter, showing solid improvement as it attempts to crawl back from the brink.

Microsoft gave no word, though, on how fared its first major computer hardware initiative, the Surface RT. The Windows RT-based tablet debuted late last year to mixed reviews, and CEO Steve Ballmer has characterized sales as "modest."

In neither the quarterly report nor the accompanying conference call, however, did Microsoft's executives go into detail on exactly how well Microsoft's first tablet sold. They opted instead to speak in general terms, citing "really great demand" for "some of the touch devices that we brought to market." Chief financial officer Peter Klein said several times that Surface sales were among the top three drivers of Microsoft's 11 percent total revenue growth, alongside Windows retail upgrades and multi-year enterprise licensing deals.

The device is estimated to have sold around a million units since its launch, though it was available initially only at Microsoft's online and physical stores before retail availability was expanded.
post #2 of 49
Based on the logic of the result the market had to Apple's stellar quarter ...

I'm guessing Microsoft stock went *up* by 10%?
post #3 of 49

post #4 of 49
"...and the iPad doesn't have a physical keyboard which means it's not good at anything. No, I like our strategy, I like it a lot"
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post #5 of 49

Did we fall through some portal and end up on Imgur?  

Everyone appreciates boobs, but this is barely even tangentially related to the thread. 

post #6 of 49
That's a good improvement in results. Maybe the story everyone keeps telling about tablets smashing PCs to a tiny minority will happen, but not quite to that extent. Maybe 50% of people will use tablets and 50% laptops, instead of 90-10. In which case Apple should give equal love to the Mac as the iPad.

It's easy to get caught up in these stories of how things are "supposed" to turn out, but then MS comes out with this respectable increase in profit. In a case of lore vs numbers, numbers win.
post #7 of 49
I really dig that shirt. That's the best a blue screen of death has ever looked.
post #8 of 49
Quote:
Originally Posted by Gazoobee View Post

Did we fall through some portal and end up on Imgur?  
Everyone appreciates boobs, but this is barely even tangentially related to the thread. 

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post #9 of 49

post #10 of 49
Spooky!

We are now officially trolling ¡
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post #11 of 49

Regardless of how you feel about Microsoft, the fact is that it did make record revenues. That is a good sign for the economy, even though there are all sorts of caveats in their numbers.

 

For those wondering why $MSFT did not crash, it's all about expectations. If you don't understand this by now, get out of the stock market.

post #12 of 49

But the kids love Windows 8...

post #13 of 49
Quote:
Originally Posted by ascii View Post

That's a good improvement in results. Maybe the story everyone keeps telling about tablets smashing PCs to a tiny minority will happen, but not quite to that extent. Maybe 50% of people will use tablets and 50% laptops, instead of 90-10. In which case Apple should give equal love to the Mac as the iPad.

It's easy to get caught up in these stories of how things are "supposed" to turn out, but then MS comes out with this respectable increase in profit. In a case of lore vs numbers, numbers win.

Let's use our brains a little, shall we?

 

Sales of windows 8 are 70% WORSE than VISTA, despite all the ultrabook propaganda, surface propaganda, win 8 tablets BS. The end of that road is getting closer.

 

Obviously Microsoft is a very nice company with some good talent so they have dozens of new ways to maintain that amazing profit margins and to try something new. What would I do? Just destroy the traditional desktop interface, all the legacy code and create a ultrafast and light windows version looking forward, not looking back. Just like what Apple did with the mac/ppc, OSX/iOS.

 

I mean, who in their right mind would prefer an Android version of the ONE X instead of an Windows (the ultrafast and light version) version of the same phone, especially on enterprise? Same with tablets and PCs.

 

Since thousands of people would work on that version (Microsoft itself, traditional OEMs, Mobile OEMs, etc), we would get a very nice, fast and reliable operating system.

post #14 of 49
funny how none of the press/web reports bothered to mention that MS was able to ship - not final consumer sales - 60 million W8 licenses only thanks to huge launch period price discounts of 35% to 75% depending on what kind of upgrade you bought. i'd bet this also included initial price incentive deals of some kind for the OEM's, so they 'banked' them.

these discounts will end in several weeks. anyone who hasn't upgraded their PC to W8 from W6 or W7 by then likely never will. so that one time sales bump is over, and from then on it will be nearly all new PC licenses alone, minus any OEM channel stuffing. let's see how that goes as the year progresses.

a few reports at least kinda noticed that business are sticking with W7. probably about 99% of them. which means W8 is an enterprise flop, but the reporters couldn't quite figure that out yet.

this kid glove coverage of MS compared to the hysterical trashing of Apple ... how can they keep a straight face?
post #15 of 49
Quote:
Originally Posted by stelligent View Post

Regardless of how you feel about Microsoft, the fact is that it did make record revenues. That is a good sign for the economy, even though there are all sorts of caveats in their numbers.

 

For those wondering why $MSFT did not crash, it's all about expectations. If you don't understand this by now, get out of the stock market

 

It's not all about expectations, it's all about stock manipulation. AAPL at a P/E of 10.2 makes about as much sense as wearing your underwear to work - on your head. Apple's warchest increased to $137 billion, it beat expectations on earnings, and it just barely missed expectations on revenue - for which it was rewarded with a 12% drop in stock price.

 

(Insert an inappropriate comment.)

post #16 of 49
Without boobs there would be no reason to have any threads.
Quote:
Originally Posted by Gazoobee View Post

Did we fall through some portal and end up on Imgur?  
Everyone appreciates boobs, but this is barely even tangentially related to the thread. 
post #17 of 49
Originally Posted by umrk_lab View Post
Originally Posted by PhilBoogie View Post
Originally Posted by Gazoobee View Post

 

 

😉

Originally posted by Marvin

Even if [the 5.5” iPhone] exists, it doesn’t deserve to.
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Originally posted by Marvin

Even if [the 5.5” iPhone] exists, it doesn’t deserve to.
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post #18 of 49
Quote:
Originally Posted by boriscleto View Post

But the kids love Windows 8...

I like windows 7. It works well for me. I was given a free windows 8 key and I refuse to install it because it is one of the worst operating systems I have seen (for desktop)
post #19 of 49

The gradual slide into irrelevance continues. 

post #20 of 49
Quote:
Originally Posted by Tallest Skil View Post


Ballmer bashing threads always get me......................hmm, maybe I should just enter a period there.

Your right TS, sorry 'bout that.
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post #21 of 49
Quote:
Originally Posted by pedromartins View Post

Quote:
Originally Posted by ascii View Post

That's a good improvement in results. Maybe the story everyone keeps telling about tablets smashing PCs to a tiny minority will happen, but not quite to that extent. Maybe 50% of people will use tablets and 50% laptops, instead of 90-10. In which case Apple should give equal love to the Mac as the iPad.

It's easy to get caught up in these stories of how things are "supposed" to turn out, but then MS comes out with this respectable increase in profit. In a case of lore vs numbers, numbers win.

Let's use our brains a little, shall we?

 

Sales of windows 8 are 70% WORSE than VISTA, despite all the ultrabook propaganda, surface propaganda, win 8 tablets BS. The end of that road is getting closer.

 

Obviously Microsoft is a very nice company with some good talent so they have dozens of new ways to maintain that amazing profit margins and to try something new. What would I do? Just destroy the traditional desktop interface, all the legacy code and create a ultrafast and light windows version looking forward, not looking back. Just like what Apple did with the mac/ppc, OSX/iOS.

 

I mean, who in their right mind would prefer an Android version of the ONE X instead of an Windows (the ultrafast and light version) version of the same phone, especially on enterprise? Same with tablets and PCs.

 

Since thousands of people would work on that version (Microsoft itself, traditional OEMs, Mobile OEMs, etc), we would get a very nice, fast and reliable operating system.

 

This is a very good idea!

 

Add new [reimplemented] versions of Office and other MS apps for the new OS.  This would satisfy most home/personal needs.

 

In their new OS, MS should allow efficient emulation of legacy Windows OSes -- just like Mac OS X can run Windows, etc. with Parallels, etc.

 

This would ease the transition for enterprise/SMB users who have apps/procedures that require legacy Windows.

 

Developers would be incented to update legacy apps to state-of-the-art hardware and OS -- and make additional sales.

 

The biggest problem would be legacy apps (developed in-house or by 3rd-parties) where the code/developer is no longer available...  These situations would require longer to migrate or obsolete/replace.

 

Something like:

  1. release the New Intel OS, say, for $29
  2. release the New ARM OS, say, for $5
  3. emulate valid copies of legacy Windows XP, 7, 8
  4. announce now new features to legacy Windows -- just maintenance
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post #22 of 49
Quote:Originally Posted by Tallest Skil View Post

 

 

<...>

😉

 

 

 

 

 

 

 

post #23 of 49
Quote:
Originally Posted by Alfiejr View Post

this kid glove coverage of MS compared to the hysterical trashing of Apple ... how can they keep a straight face?

It's no different than people who expect Apple to reinvent something magical every year, as if on schedule, while holding no other company accountable to the same expectation. Certainly not MSFT.

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post #24 of 49
Originally Posted by umrk_lab View Post

 

Hey, look, it's the original Surface's prototype!

Didn't work very well mounted on the wall. And being as large as the floorspace of an entire room.

Originally posted by Marvin

Even if [the 5.5” iPhone] exists, it doesn’t deserve to.
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Originally posted by Marvin

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post #25 of 49
Quote:
Originally Posted by Dick Applebaum View Post

 

This is a very good idea!

 

Add new [reimplemented] versions of Office and other MS apps for the new OS.  This would satisfy most home/personal needs.

 

In their new OS, MS should allow efficient emulation of legacy Windows OSes -- just like Mac OS X can run Windows, etc. with Parallels, etc.

 

This would ease the transition for enterprise/SMB users who have apps/procedures that require legacy Windows.

 

Developers would be incented to update legacy apps to state-of-the-art hardware and OS -- and make additional sales.

 

The biggest problem would be legacy apps (developed in-house or by 3rd-parties) where the code/developer is no longer available...  These situations would require longer to migrate or obsolete/replace.

 

Something like:

  1. release the New Intel OS, say, for $29
  2. release the New ARM OS, say, for $5
  3. emulate valid copies of legacy Windows XP, 7, 8
  4. announce now new features to legacy Windows -- just maintenance

Exactly, and force people to upgrade. At first, those that for some reason do not like it, would buy/stick to win7, there's no other option for the traditional user. Then, Microsoft should just push forward with it, what can the Adobe or IT departments and even OEMs of this world do?

 

That way, everybody wins.

post #26 of 49
Quote:
Originally Posted by Alfiejr View Post

funny how none of the press/web reports bothered to mention that MS was able to ship - not final consumer sales - 60 million W8 licenses only thanks to huge launch period price discounts of 35% to 75% depending on what kind of upgrade you bought. i'd bet this also included initial price incentive deals of some kind for the OEM's, so they 'banked' them.

 

I just ugraded an XP machine to Win8.  The downloaded version is currently $40, MS claims the regular price will be $240 so that amounts to 83% off.

Win8 is certainly different than Win7.  I use 7 at work and since we just upgraded from XP I doubt that I will ever have Win8 at work.  I don't have an opinion on whether 8 is better or worse than 7 but it is going to be a challenge using two different operating systems, three and 1/2 counting IOS and the rare times my daughter lets me use her Air.

post #27 of 49

Yet another company that refuses to release the sales figures for their tablet.

 

Why? Because it is a complete failure, a flop and a joke, that's why. MSFT is up today, needless to say.

post #28 of 49
Its amazing how a company does really well and somehow that is an admission of failure. When did technology become politics where only one side can win. When ALL tech companies do well, its good for the industry as a whole (and us for that matter...the consumer). I think the one thing most myopic contributors do not understand about Microsoft is, they are not a one trick pony. Look their entire product portfolio, various Windows OS's, Server OS's, Office, Cloud offerings, Server products, XBOX, etc....I really do not get how people come to the conclusion that Microsoft has somehow failed (and usually only because they are MS haters).
post #29 of 49
Quote:
Originally Posted by rockydog View Post

I really do not get how people come to the conclusion that Microsoft has somehow failed (and usually only because they are MS haters).

 

Just to clarify, I think that their tablet is a failure. My statement was not about MS or the company, but rather, about their tablet. 

post #30 of 49
Quote:
Originally Posted by rockydog View Post

Its amazing how a company does really well and somehow that is an admission of failure. When did technology become politics where only one side can win. When ALL tech companies do well, its good for the industry as a whole (and us for that matter...the consumer). I think the one thing most myopic contributors do not understand about Microsoft is, they are not a one trick pony. Look their entire product portfolio, various Windows OS's, Server OS's, Office, Cloud offerings, Server products, XBOX, etc....I really do not get how people come to the conclusion that Microsoft has somehow failed (and usually only because they are MS haters).

Who said that? and yes they are a one trick poney right now. "we do everything worse, but cheaper-and-change-is-not-necessary-let's-live-in-the-past sort of strategy". 

post #31 of 49
The surface took that long to sell a million units. The iPad sells that many in 1 weekend. They call that good? That's another Zune failure if you ask me. If you bought one you better return it because in 6 months Microsoft will shutdown production and support for it anyways just like the Zune.
post #32 of 49
Quote:
Originally Posted by Apple ][ View Post

 

Just to clarify, I think that their tablet is a failure. My statement was not about MS or the company, but rather, about their tablet. 


It's still too early to tell. MS has deep pockets and will have more hardware coming out. In time, more people will have MS tablets, and maybe a lot of people will use it.

 

MS needs to fix Win 8. I put it on my MacBook and I got very frustrated with the navigation. I like the OS, but they need better visual cues for navigation. Or make it easier to navigate. There is a tool out there that will turn off the new interface and give you the Win 7-like desktop.

post #33 of 49
Quote:
Originally Posted by Quadra 610 View Post

The gradual slide into irrelevance continues. 

 

Wasn't really all that gradual. As far as continuing, I think they are already pretty close to the bottom of the slope.

post #34 of 49
Originally Posted by b9bot View Post
If you bought one you better return it because in 6 months Microsoft will shutdown production and support for it anyways just like the Zune.

 

Windows XP has support until 2014. So does the port VGA (not Microsoft-related in any respect, but it infuriates me every time I think about it). 

 

So support for the Surface won't be an issue, even when it's prematurely discontinued. Like the Kin!

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post #35 of 49
Quote:
Originally Posted by Tallest Skil View Post

 

Windows XP has support until 2014. So does the port VGA (not Microsoft-related in any respect, but it infuriates me every time I think about it). 

 

So support for the Surface won't be an issue, even when it's prematurely discontinued. Like the Kin!

your definition of support is strange.

 

Say that to lumia buyers.

post #36 of 49

deleted


Edited by MacRulez - 5/16/13 at 12:32pm
post #37 of 49

I hear "downgrading" is all the rage now.  All the cool IT kids are doing it:

 

Sent from my iPhone Simulator

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post #38 of 49
Quote:
Originally Posted by Timbit View Post


I like windows 7. It works well for me. I was given a free windows 8 key and I refuse to install it because it is one of the worst operating systems I have seen (for desktop)

 

It seems without a touch interface Windows 8 on a desktop is a bit hit and miss, changing things just for change sake rather than improving user experience or productivity. But that is nothing compared to Windows Server 2012 - can somebody please explain why you need the Metro interface on a server?

post #39 of 49
Quote:
Originally Posted by ScartArt View Post

It seems without a touch interface Windows 8 on a desktop is a bit hit and miss, changing things just for change sake rather than improving user experience or productivity. But that is nothing compared to Windows Server 2012 - can somebody please explain why you need the Metro interface on a server?

Don't consumers run their data centers on tablets? /s

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post #40 of 49
Quote:
Originally Posted by ScartArt View Post

 

It seems without a touch interface Windows 8 on a desktop is a bit hit and miss, changing things just for change sake rather than improving user experience or productivity. But that is nothing compared to Windows Server 2012 - can somebody please explain why you need the Metro interface on a server?

 

That's so no good Microsoft customer can go unpunished.

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