Microsoft Troubles - Starting signs

Previously I've written I expect Microsoft will experience a "Financial Pothole" around 2010, this is not it, only a portent of things to come.

Microsoft reported a profit slump and job layoffs today (AP, Reuters), as did many others - Intel and e-Bay are cited.


"Apple was a standout to the upside and was among the biggest lifts on the Nasdaq after it posted quarterly profit that surpassed Wall Street's expectations on Wednesday after the closing bell."

From the Guardian :

... expects Microsoft to report sales of its Windows software for PCs and laptops to drop 3 percent from a year earlier, making it the toughest quarter in eight years.

Microsoft are cutting "up to 5000 jobs", but otherwise Ballmer doesn't foresee problems:

Our products provide great value to our customers. Our financial position is solid. We have made long-term investments that continue to pay off.

From ZDnet's Mary Jo Foley:

(for 2008Q4) client revenue was down eight percent, compared to the same quarter a year ago. OEM revenue — the money Microsoft earns by charging its PC maker partners a set amount for each copy of Windows they preload on new systems — was down $465 million, or 12 percent. OEM license units were down one percent, according to the company.

Larry Digman of ZDnet says of 'netbooks':

Embedded in Microsoft’s earnings report and restructuring news was an implicit message that’s hard to ignore: Netbooks are disruptive and wreaking havoc in the industry.