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TheBigFatJ on 25 January 2008
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Legend11 said:
Strange the guy would say that considering that the Entertainment and Devices Division which was a drain on the company is now making money and the warranty issues were paid for in advance last year. It's almost like his article is 6 months out of date.

If he sees problems with Microsoft with it's record revenue and profits it'll be interesting to see what he says about Sony which will likely lost many hundres of millions of dollars because of the PS3.
 Investors should be more well informed than to think MS entertainment division is making money since it is actually losing money.  It's just losing money set aside for it that won't count on this year's (or next year's) financial reports.  Once that money is exhausted, MS will have to do something else which will wipe away its "profits" in that division.

Have you looked at the overall health and trend for the company.  MS is not doing as well as the S&P 500, nor are they comparing well to key competitors like Apple and Sony.  They just released their OS refresh -- the first in 5 years -- so it's expected that profits would be way up.  But MS isn't doing as well as many expected (note that MS always beats 'expectations' despite not doing as well as its competitors).

He also points out that MS is losing money in various segments where they're supposed to be making money.  Including the online segment where they're hemhorraging money against competitors like Google.

The problem seems to be that MS is outmatched -- every where they have competition there are better, smarter, faster companies selling better products.  Apple, Sony, Google, Adobe.  They're all better in their respective areas than Microsoft is. This suggests that MS will move away from dominance.