Microsoft Corporation (MSFT): Is The Tech Giant Headed On The Correct Trajectory?

Page 1 of 2

Everytime Microsoft Corporation (NASDAQ:MSFT) unveils a new operating system, investors hesitate. The release of Windows Vista cost the company its stranglehold on the market. In 2004, the ratio of Microsoft Corporation (NASDAQ:MSFT) computers to Apple Inc. (NASDAQ:AAPL) computers peaked at 56 to 1. In 2012, 20 Microsoft computers were sold for every one Apple Inc. (NASDAQ:AAPL) computer, according to data from Asymco. That figure doesn’t include tablet and smartphone sales.

Lessons learned from Vista

Obviously, Microsoft would love to reach 2004 levels, which began to drop with the release of Vista. The company began to climb its way back up with Windows 7, so, as the company announced the release of Windows 8, it was understandable that investors met the news with trepidation.

After all, just before Windows 8′s release, Microsoft Corporation (NASDAQ:MSFT) shares dropped approximately 10% — a decline that happened in less than a month. Investors, hopeful that a new product would bring an increase in revenue, may have been eager to get in on the ground floor of an exciting new product.

But, those investors wouldn’t have done their research. History shows that Microsoft stocks actually drop following the release of a new operating system. Vista’s 9.6% drop was actually less of a drop than the 10.1% decline that happened after the release of Windows 98. But, even the release of Windows 95 and XP — both of which went on to become extremely popular Microsoft Corporation (NASDAQ:MSFT) operating systems — weren’t without share price declines just after the release.

Microsoft Windows 8 increase

For savvy investors, it came as no surprise when Microsoft Corporation (NASDAQ:MSFT)’s stock began to fall as release day neared. Earnings were down, as well, but this was likely related to consumers delaying purchase of new PCs that contained the soon-to-be-outdated Microsoft 7 operating system.

It’s not unusual for consumers to avoid purchasing technology in the days leading up to the release of a newer model. And with new PCs and laptops lasting longer than ever, anyone purchasing a PC today knows they’ll likely be stuck with that operating system for at least four or five years, maybe longer.

By December of last year, things weren’t looking very bright for Microsoft. Google Inc (NASDAQ:GOOG)‘s Android operating system seemed to be taking over phones and tablets across the world. Microsoft Corporation (NASDAQ:MSFT) countered with its Surface tablet, but Google is still leaving both Apple and Microsoft behind when it comes to tablet sales.

Tablets powered by the Google Inc (NASDAQ:GOOG) O/S are now outselling competitors thanks to inexpensive alternatives like Google’s Nexus and the Kindle Fire. This year, devices powered by Google are expected to claim nearly half of the market — last year, Apple Inc. (NASDAQ:AAPL) held 51% of the market, with Google still holding an impressive 46%.

Page 1 of 2

Biotech Insider Alert - $6 Stock To Hit $40

$200 Million Dollar Healthcare Hedge Fund's #1 Best Idea Right Now

The best healthcare hedge fund out there right now is one of the largest shareholders in this biotech stock. The fund returned more than 20% in each of the last 2 years with a virtually fully hedged portfolio, and it's sending out a BUY signal on this biotech stock. Get your FREE REPORT today (retail value of $300)

This is a FREE report from Insider Monkey. Credit Card is NOT required.
Comments
Insider Monkey Small Cap Strategy
Insider Monkey Small Cap Strategy

Insider Monkey beat the market by 52 percentage points in 24 months. Our beta is only 1.2 (don't click this link if beating the market isn't important to you).

Lists

The Oldest Money Managers

The Greatest Directors in the World

Largest Animals in the World

World’s Most Expensive Desserts

Best Selling Comic Books of All Time

A-list Actors who Sabotaged Their Career

Rappers With a College Degree

The Best Jazz Albums of all Time

The Most Influential Jazz Musicians

The World’s Most Famous Photographers

The Best Oscar-Winning Songs

Most Influential Choreographers Ever

Most Expensive Department Stores in the World

The Most Expensive Stolen Paintings in the World

The World’s Most Expensive Teas

Top Oscar Record Holders

The Most Expensive Flowers in the World

Countries With a Booming Film Industry

Most Expensive Cupcakes in the World

Uncommon European Escapes

The Most Stolen Artists in History

Best Travel Destinations in Australia

World’s Most Expensive Musical Instruments

World’s Most Famous Animals

Most Expensive Cakes in the World

Most Expensive Kosher Champagne in the World

Most Expensive Kosher Wine in the World

The Most Surprisingly Dark Fairy Tales

Most Popular Travel Destinations in Asia

The 10 Most Expensive Dresses Ever Worn to the Oscars

World’s Most Visited Art Museums

Best Countries for Photographers to Work in

Best Paid Jobs in the Film Industry

The Most Renowned Recovered Paintings Ever

Child Stars That Turned out Just Fine

Books That Were Banned in the Past Century

World’s Richest Dancers

Best Remedies against Bad Breath

Foods That Improve Your Skin Texture

Best-Selling Children’s Books of all Time

Foods That Boost Your Libido

Best-Selling Books of all Time

The Most Expensive Academy Awards Jewelry in History

Most Expensive Japanese Restaurant In New York City

The Best B-Boy Movies

Most Awesome Hip Hop Documentaries

Foods That Stain Your Teeth

Richest Doctors in the World

The Best Movie Sountracks Ever

The Highest Grossing Musicals on Broadway

Subscribe

Enter your email:

Delivered by FeedBurner

X

Thanks! An email with instructions is sent to !

Your email already exists in our database. Click here to go to your subscriptions

Insider Monkey returned 129% in 2.5 years!! Wondering How?

Download a complete edition of our newsletter for free!