Apple is no prize either
While Microsoft has had a tough time in the last year, Apple Inc. (NASDAQ:AAPL) also did not enjoy a favorable run on Wall Street. Apple Inc. (NASDAQ:AAPL)’s share price has declined approximately 30% in the last 12 months owing to skepticism around innovation and designs, legal issues and stiff competition from Samsung in the smartphone market. Apple Inc. (NASDAQ:AAPL)’s next generation iPhone 5S has been caught up in production issues pushing the official launch to end of September. In all probability, it will affect the overall demand as customers might move on to other available options.
Since the company has not executed any major developments in the quarter, there are minimal chances that its results will appease investors. As this mashable article points out, Apple Inc. (NASDAQ:AAPL) is witnessing its longest product drought in recent times. This is definitely not encouraging news for a company that is famed for building new and superb products.
Microsoft is moving in every direction
For years, I have been a Microsoft aficionado because of its products that always had one very essential attribute: user-friendliness. While Apple Inc. (NASDAQ:AAPL) built products that were about design, Microsoft got down to simple and basic products that could be easily used by people at large. I am not saying that its products are not user-friendly any more but I definitely believe that the company is steering in various directions without robust results in any one.
Since the PC industry is dying slowly, Microsoft already has enough challenges to combat. However, its decision to enter the tablet markets with both hardware and software was not a sound one because the company does not specialize in hardware. It has already incurred a $900 million charge because of the price reduction with Surface RT tablets. In my opinion, the big problem with Microsoft is that it’s riding many horses at once, which is not helping it achieve desired results.
Final words
Microsoft’s constant decline in revenues due to sluggish PC demand is not a big concern as of now because it is destined to happen. In the fourth quarter, a decline of 20% in consumer PC demand led to a decline of 15% in OEM revenues. The current challenge for the company is to steer away from tough conditions by focusing on its crucial product, Windows 8. I would not suggest investing in the stock because the company is nowhere near a robust turnaround and hence, it would be unwise to put a bet on the stock.
The article This Giant Is Not Getting up Anytime Soon originally appeared on Fool.com and is written by Mihir Mehta.
Mihir Mehta owns shares of Google. The Motley Fool recommends Apple and Google. The Motley Fool owns shares of Apple, Google, and Microsoft. Mihir is a member of The Motley Fool Blog Network — entries represent the personal opinion of the blogger and are not formally edited.
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