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Microsoft Corporation (MSFT) Is Grabbing Market Share Here

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After announcing what many investors and analysts considered a surprisingly positive fiscal Q3, Microsoft Corporation (NASDAQ:MSFT) shareholders are finally seeing some light at the end of the tunnel. Microsoft Corporation (NASDAQ:MSFT)’s shift to cloud-related products and services is beginning to drive revenue growth, but questions remain about users’ willingness to buy mobile devices running its much-hyped Windows 8 operating system, especially here in the States. Turns out Microsoft Corporation (NASDAQ:MSFT) is making strides there, too.

Microsoft Corporation (MSFT)The usual smartphone OS suspects
The latest data from Kantar Worldpanel detailing Q1’s domestic smartphone OS market share shows the usual cast of characters sitting at the top. That’s not surprising. What is eye-opening is the dent Microsoft Corporation (NASDAQ:MSFT)’s Windows 8 is making in the U.S., even as Google Inc (NASDAQ:GOOG)‘s Android OS and Apple Inc. (NASDAQ:AAPL)‘s iOS market shares remain flat, or worse.

With 49.3% domestic smartphone OS market share in Q1, Google Inc (NASDAQ:GOOG) continues to lead the way, just as it does globally. Apple Inc. (NASDAQ:AAPL), as is par for the course, remains a close second in the U.S., running 43.7% of our smartphones. With 37.4 million smartphones sold in its recent fiscal Q2 and such a strong domestic presence, running neck-and-neck with Android in the U.S. isn’t a shock. Apple’s piece of the pie is impressive though, especially when you consider Android has the benefit of being the OS of choice for multiple smartphone manufacturers, while Apple’s iOS is all about iPhones.

Now, the rest of the story
In spite of the huge OS lead Google and Apple enjoy, digging a bit deeper into Kantar’s numbers for Q1 paints an intriguing picture, especially for Microsoft Corporation (NASDAQ:MSFT) fans. Though Android’s share of the smartphone OS market improved in Q1 compared to the year-ago period, it was marginal at best. And what little growth Google’s operating system did garner came early in the calendar year, as evidenced by its 1.9% decline versus the three-month period ending in February.

As for Apple, its share of the U.S. smartphone OS market actually declined in the first quarter of 2013, dropping about 1%. While factors such as the timing of new smartphone rollouts and increasing competition tell part of the story of why Apple’s OS share is declining, Microsoft Corporation (NASDAQ:MSFT)’s Windows 8 growth in Q1 also had an impact.

Windows 8 now accounts for 5.6% of all U.S. smartphone operating systems; a paltry number compared to the incumbents. But there are a few points worth noting before discounting Windows 8. First, as the relative new-comer on the block, consistent growth is what investors should concentrate on in these early stages. Overtaking Android or iOS was never going to happen overnight.

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