America
Microsoft's Windows disappoints on lukewarm PC sales
Updated: 2011-01-28 10:33
(Agencies)
SEATTLE – Sales of Microsoft Corp's Windows software fell short of outsized expectations, rekindling fears that the spread of mobile gadgets will erode its main PC-focused business.
Microsoft surprised Wall Street with a better-than-expected profit, helped by resurgent corporate spending after the belt-tightening of past years. But its shares stayed flat as investors expressed concern about the weakness of overall computer sales amid a faltering US recovery.
"Outstanding numbers when you take a first look at it, but when you delve into them, Windows missed expectations by $300 million," said Brendan Barnicle, analyst at Pacific Crest Securities.
Sales of smartphones and tablets are expected to grow much more quickly than PCs over the next few years, posing a threat to Microsoft's key market.
With the migration to mobile devices from desktop computers expected to accelerate, Apple overtook Microsoft to become the largest US technology company by market value last May.
But some analysts argued that fears of tablets and other hot-selling gadgets replacing PCs were overblown -- at least for now.
"We've gotten over 300 million Windows 7 licenses sold. I mean, PCs are not disappearing. Put that into perspective with 7 million tablets sold last quarter from Apple," said BGC Financial's Colin Gillis.
"Clearly there are disruptions in the landscape, but some of the negative viewpoints are overblown."
Microsoft stock is down about 3 percent over the past 12 months, compared with a 24 percent gain for the tech-heavy Nasdaq. Apple shares are up 65 percent over the same period.
E-paper
Ear We Go
China and the world set to embrace the merciful, peaceful year of rabbit
Preview of the coming issue
Carrefour finds the going tough in China
Maid to Order
Specials
Mysteries written in blood
Historical records and Caucasian features of locals suggest link with Roman Empire.
Winning Charm
Coastal Yantai banks on little things that matter to grow
New rules to hit property market
The State Council launched a new round of measures to rein in property prices.