Microsoft Stocks and Shares Losing Steam Fast

Heidi Speare July 22, 2013 0

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While we expect every company to announce its earnings for the previous quarter, Microsoft is dealing with bad stocks and shares. This company has missed Wall Street’s earnings expectations. To be honest, we don’t see anything great yet coming of this tech giant so far. Maybe small spark will get it going but for now they don’t have it. I truly believe that by the end of the year Microsoft will do something to increase its role on the market. For now, things are not so great.

Microsoft has reported $4.97 billion as a net income which equals to 59 cents per share. This means that Microsoft has lost $492 million from the same period a year ago when this company has written down $6 billion. For this reported period that ended on June 30, Microsoft has taken a $900 million for decreasing the price of it Surface RT tablet device. We know that this device struggles to gain the proper traction in the tablet market. If you exclude the Surface charge, earnings were stopped at 66 cents a share which is still short of the 75 cents a share that was expected by analysts in FactSet.

Microsoft’s revenue grew 10% netting $19.9 billion, but this is quite short the $20.7 billion expected. Shares have fallen more than 6% in the after-hours trading period to $33.03. Its shares closed at $35.44 in regular trading which is down 30 cents. The analysts who are following Microsoft are saying that the jury still has respect for the major moves made by Steve Ballmer, Microsoft CEO, in these recent months. Not only they discounted Surface RT tablet, Microsoft has unveiled its new gaming platform, Xbox One, and Ballmer announced massive restructuring of the management.

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After this, there comes the pressure from the investors who as it seems still believe in Ballmer’s work. They hope that Windows 8.1 Blue, first bigger upgrade of Win 8, will boost Ballmer’s struggle to reorganize Microsoft as a service and devices company. According to David Cearley, an industry analyst, Microsoft is far from done and they are aggressively heading towards its challenges. He added that they will get through this and by going forward strong they will remain one of the stronger players into the market.

IDC’s application software analyst, Al Hilwa, said that Ballmer’s reorganization of the company’s executives in order to make them more accountable for making decisions shows really great future, but it will take more time to transfer this organizational switch to services and products.

Microsoft isn’t the only company that reported a loss. Investors are not spearing this company as its stock price went down 3% after disappointing Q2 report. Google reported $3.23 billion profits of $14.1 billion revenue. This has missed analysts’ forecasts and expectations for the second quarter. The concern is bigger for its advertising from all internet searches.

Microsoft’s shares are down over 10% after total earnings missed Wall Street’s expectations. We’ll see how well it will perform by the end of this year.

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