For the first time in its 26 year public history Microsoft (NASDAQ:MSFT) posted a quarterly loss. That’s a pretty impressive feat frankly, both up until this point and for this quarter. They did so even though revenue was up year over year by 4% and earnings not counting the massive aQuantive write-down rose 5.7% to $0.73 for the quarter. In the end the quarterly loos Microsoft posted came about because in the arena of paid search and advertising Google (NASDAQ:GOOG) kicked their tails.
They are currently doing so as well in the smartphone market while Android continues to struggle in the tablet segment. And even that dam looks like it is beginning to break. The Google Nexus 7 tablet is getting rave reviews and initial sales are very promising. Not that this was a hard thing to figure out after Amazon (NASDAQ:AMZN) sold millions of inferior Kindle Fires simply because the 7″ form factor is perfect for the tablet, more so than the 10″ for those that want something functional without being obtrusive.
The boys from Redmond have announced that Windows 8 is coming on October 26th, and because of their $15 upgrade offer on Windows 7 Microsoft had to defer some Win 7 revenue or their results would have been even better. Growth, surprisingly, for Microsoft came from their server and enterprise division which bodes very well for their coming plan to integrate Windows fully into their cloud computing strategies. With PC sales projected to be flat in the 3rd quarter Microsoft’s revenue will likely be uninspiring next quarter as well, but once we have the answer about what the world really thinks of Metro and Windows 8 we’ll have a clearer picture of Microsoft’s future. Frankly, given my choice between Apple and Google, without a viable Microsoft I’d switch to Linux.
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