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MSFT Off On Write-Down
Markets are up in the shortened trading day as factory orders surge past estimates. Shares of MSFT are off after the company wrote down $6 billion in assets. Catalysts for the stock include Windows 8, Windows Server 8, Office 15 and Windows Phone 8; expansion in the smartphone market with primary hardware partner Nokia as well as tablet market with Surface; strides in cloud computing; profitability in the online business, including integration of Skype; and continued evolution of Kinect and next generation Xbox. The stock currently trades at 7.7x Enterprise Value / TTM Free Cash Flow.Microsoft’s Mobile Market Share Dismal, But Not As Bad As Before (Mashable and BI Intelligence)
Microsoft’s share of the smartphone market grew just 0.1% between February and May to 4%, according to comScore. That’s a 0.4% drop since January. Year-over-year, Microsoft’s share fell 1.9%, according to comScore. While it appears that nothing has done much to move the needle on sales, Microsoft has finally stopped shedding market share in the U.S. As BI Intelligence points out, for the first time in years, Microsoft’s smartphone platform gained share.
What RIM Moving To Windows Phone 8 Would Look Like (ReadWriteWeb)
The future of RIM depends on BlackBerry 10 but it holds a variety of assets that are attractive to other companies. Microsoft, which still has a robust business in enterprise software, would love to get its hands on RIM’s proprietary network, which drives its secure messaging platform. The software giant has shown it is not afraid of spending money to move aggressively into the mobile market. But would the marriage work? Longer term, the real question is whether a combined Microsoft/RIM/Nokia beast could even challenge Apple and/or Google in the smartphone platform wars.
Microsoft’s $6 Billion Whoopsie (CNN Money)
Microsoft spent $6.3 billion in cash buying online display advertising company aQuantive in 2007. And here we thought it overpaid by $600-$700 million. It turns out we were wrong. The company just wrote off almost the entire value of the acquisition. Microsoft’s online advertising business has remained wildly unprofitable. Over the past 12 months, the division’s losses reached nearly $2 billion. To capture the attention of a critical mass of advertisers, enough to turn a profit, search market analysts say that Bing will need at least 25% to 30% of the market. That’s double Microsoft’s current share.
Don’t Worry, More Windows Phone 8 Features Are Coming (Pocket-lint)
Greg Sullivan, senior product manager for Windows Phone, confirmed there was plenty more coming in Windows Phone 8 besides just a new start screen. Much of the Sneak Peek event focused on Windows Phone 8 developer and IT pro features, with consumers only really getting a glimpse at the new start screen and the NFC wallet. However, Sullivan was keen to tell us that won’t be the case in the final version. “The way we are thinking about this is that Windows Phone 8 is a generational shift that has an associated discontinuity that we don’t expect to happen again soon,” he said.
Behind The Yammer Acquisition (Fortune)
Microsoft is snatching up business social networking tool Yammer (a.k.a Facebook for the workplace). A silent revolution in enterprise IT is already underway:
- The consumerization of enterprise software
- Software becomes a cloud-based service, not a product
- The CIO gets crowd-sourced
- Enterprise software goes social
- Business computing goes mobile
As those clunky legacy systems get phased out, opportunities exist for cloud-based, SaaS enterprise solutions built for the mobile era.
The Method To Microsoft’s Madness (Read Write Web)
Much of Microsoft’s 30-year history is a tale of bulldozing the rest of the world into doing what’s best for Redmond. Although the company has taken a gentler tack in recent years, its Surface tablet augurs a return to ruthlessness. This time, though, the erstwhile PC leader has good reason: It must betray old loyalties if it is to remain relevant to the future of personal computing. Read more.