5 Things To Know From Microsoft Corporation (MSFT)’s AGM

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Microsoft Corporation (NASDAQ:MSFT) held its Annual General Meeting recently. The meeting came on the heels of the significant changes to its business structure that have been executed by its CEO, Satya Nadella. He assumed the role in February of last year after Steve Ballmer paved the way to take the reins. One of the most significant changes was the focus towards cloud computing. Nadella’s slogan was very simple, ‘mobile first, cloud first’. After he has assumed the role, it was the first full year of operations for which AGM was conducted. There are at least five things that investors should know. The stage was also the right choice for investors to know what is in store for them. Therefore, let’s look at some of the important things.

Change Of Business Philosophy

The first and foremost is the change in business philosophy adopted by Microsoft Corporation (NASDAQ:MSFT) when it launched Windows 10 OS. For the first time probably in its history, the company has allowed free downloading of the OS to its previous edition users. That meant a loss of revenue and the company was prepared for it to gain significant market share in the desktop, as well as, laptop OS. The company cannot afford to lose its stronghold in the segment as it lost its chance in the smartphone OS segment. Its intention is to cross one billion Windows OS coverage so that developers could turn their focus on to create more apps for its OS. In a nutshell, the objective is clear, i.e. its OS should suit any platform, and no developers can afford to ignore it.

The second significant factor is the change of heart in its tactics to bring its Office tools to Apple Inc. (NASDAQ:AAPL)’s iOS devices and Android. Until recently, it was more of a Windows-based, and the company sees enough opportunity if it is thrown open to other devices also like iOS or Android. That is a tactical change in line with the market trend though it was a deviation from the conventional method of using its devices. Also, the company expects a common Windows 10 for all, including smartphones, should enable it to attract more users.

Surface And Surface Pro

The third thing is Microsoft Corporation (NASDAQ:MSFT)’s focus on its latest Surface Laptops and Surface Pro hybrid tablet. The company has created ads to send a message clearly. The software firm wanted to take advantage of the upcoming holiday season and the video feed showed during the AGM exhibited how its commercials on Windows 10 OS, as well as, the Surface and Surface Pro would be promoted in the holiday season period. The current month is undoubtedly crucial for a lot of companies and electronic gadgets in particular. Its laptop is said to be cheaper compared to iMac for a similar configuration.

The fourth thing is in relation to cloud computing and its offerings. Microsoft Corporation (NASDAQ:MSFT) has made cloud a priority and is considered one of the leaders next to Amazon in the arena. The company’s chairman, John Thomson, reiterated its focus on creating an intelligent cloud apart from developing more personal computing. He said that the software firm would also reinvent business processes and productivity. It has identified three bold ambitions to define its success for future. Its CFO, Mary Hood, said that the objective is to reach $20 billion in revenue from commercial cloud segment by 2018. That might mean about 20% of the overall revenue. The company has already made enough traction in creating fresh sources of revenue growth from the commercial cloud, gaming, hardware, and search. Therefore, it is quite possible for the company to realize the objective.

Bing’s Market Share

The fifth factor is that Microsoft Corporation (NASDAQ:MSFT)’s Bing, a search engine, witnessed more than 20% market share in the America. That comes at the cost of Yahoo! Inc. (NASDAQ:YHOO) and Alphabet Inc (NASDAQ:GOOGL)’s Google search engine. Additionally the company’s gaming console, Xbox One, as well as, Surface was witnessing strong results.

The meeting came on the heels of comments from Steve Ballmer that hewas not convinced about the new way of reporting. The former CEO had to give up his Director position though he remained the biggest shareholder. Ballmer was of the view that the software firm should reveal sales and profit margins number compared to its intention of disclosing annualized revenue run rate. He aired his opinion to Bloomberg and not during the meeting.

Viraj Shah

Viraj Shah has completed M.Com (Finance) and is currently pursuing his CFP. He tracks US markets along with other global markets like India very closely. He is very passionate about stocks, real estate, and technology. He also believes that money can always be made in the market.

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