For the first time in 20 years, Microsoft reported a smaller profit than Apple last quarter. Microsoft’s net income last quarter was $5.23 billion to Apple’s $5.99 billion. Microsoft’s Windows division dropped 4.4% in revenue last quarter, falling $150 million below analyst estimates. Consumer PC shipments dropped 8% while netbook shipments dropped 40%. Were you reading that sentence on an iPad?
Microsoft also suffered its second-largest loss on its online operations last quarter, losing $726 million. All these recent loses and underperformances might help explain why the stock dropped 3% last Friday alone. Microsoft stock has dropped a total of 16% over the past year while it’s benchmark, the Nasdaq composite, has risen 16%. Microsoft still has the second largest market cap among U.S. tech stocks. Apple usurped Microsoft last year and became the largest by a long shot with a current value of $321 billion. Microsoft is valued at $225 with IBM in third place at $207 billion.
It’s not all bad news for Microsoft. Among 35 analysts polled by StarMine, 25 recommend buying Microsoft stock and only one recommends selling, which means there are 9 fence-sitters afraid to say the dirty word sell. The stock also surpassed earnings estimates last quarter, generating diluted earnings per share of 61 cents compared to an estimate of 56 cents per share. Despite visible revenue drops as in the aforementioned Windows division, Microsoft’s total revenues were up 13% compared to the same quarter last year. The growth was thanks to a 60% increase in sales in the Entertainment and Devices division, 21% growth in the Business division, and an 11% growth in Servers and Tools but not thanks to Bing or consumer PC and netbook sales. Can we just go on record saying Windows 7 was not our idea?
- Microsoft made less money than Apple last quarter. (Bloomberg, picture via Cajun Boy)
- Microsoft lost $726 million from its online operations last quarter. (full chart at SAI)
- Microsoft shares have been taking a beating. (Reuters)
- Microsoft still exceeded earnings estimates, however. (TechCrunch)
- Starting today, AT&T (the second largest broadband internet provider) will begin placing usage caps on over 16 million accounts. The monthly cap is now 150 GB for DSL subscribers and 250 GB for UVerse users. AT&T subscribers will be charged an extra $10 per month for every 50 GB of overage. Think there’s no way you could go over the 150 GB/month cap? If you watch more than two hours of HD content on Netflix every day (2.3 GB per hour), you’ll likely get hit with additional fees. (Gizmodo)
- To compete with Apple’s iTunes, Amazon is lowering the cost of songs to 69 cents each compared to the $1.29 iTunes currently charges. Amazon holds a 10% market share of the online music sales and Apple has 70% market share. Here are other numbers: three, forty-seven, eighty-two, eleventy. I’m sure there are others. (Techland)
- In other music news, the founder of Bose donated a majority of the company’s shares to MIT. They are non-voting shares, so MIT won’t be running the company, but they will be making a huge, steady stream of income from all those fancy gewgaws. (CrunchGear)
KNOW YOUR STATS
- The Royal Wedding garnered 2.7 million social media mentions in a 24 hour period, which is a perfectly fine excuse to post the picture to the left. (VisualLoop, picture via JoanneCasey)
- Mobile payments startup Square set a new personal record on Friday by processing over $2 million in payments through their iOS/Android dongle in one day. To put their explosive growth in context, that’s almost three times their daily average during the first quarter of this year, and they’re adding about 100,000 new merchants per month. I hope some of those merchants sell yellow hats. (Mashable)
- Here’s a helpful infographic about infographics. Mmm, infographic-y. (BuzzFeed)
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