Microsoft has been a publicly traded company going on three decades now. For much of that time, it wasn’t a smart move to bet against the software giant from Redmond, Washington. Indeed, betting against the company that manufactured the operating software most of the world’s computers ran on was a sure way to lose money. Throughout its history, Microsoft has created lots of millionaires from its employees and stockholders.
In fact, Microsoft was so steady as a stock pick that its stock predictably split throughout the years. If you have been paying to our coverage of Microsoft in these pages, you’d know that this company has fallen off-quite a bit. Considering how much of the world’s computers are still dependent on Windows to run, Microsoft has been having a tough time producing growth. Wall Street has kept the stock on neutral gear for close to a decade now. If that isn’t bad enough, even the huge hype about Windows 8 hasn’t gotten the market or consumers excited about Microsoft.
What is the problem? Well, there are several but the biggest obstacle facing the House Bill Gates Built is the company’s dependency on PCs. Unless you’ve hiding under a rock or smoking one, you’d know that consumers are quickly becoming less and less PC dependent. In fact, tablets and mobile devices are selling faster than PCs. Definite bad news for Microsoft. The second problem Microsoft faces is that it is up against two fast growing and aggressive competitors-Google and Apple. Watching Microsoft trying to catch its fleet-footed competitors is like watching Wiley E. Coyote chase the roadrunner-amusing at first but quickly becomes a sad sight to behold. Another worrying trend is Microsoft’s shrinking profit margin. It used to rack up double digit profits-not anymore. Its latest margin figures come in at an anemic year over year figure of 4%.
Many analysts shake their heads at Microsoft’s focus on Windows 8. Considering its huge stable of services and products, all the focus on a new OS makes Microsoft look smaller and more vulnerable than it truly is. Microsoft needs to hit the ball out of the park with this upcoming OS. Unfortunately, things don’t work that way. It often takes a bit for a new OS to truly own the market.