Who’s the big dawg on Wall Street these days? For the past few years– up until a month or so ago– Apple was the wolf of Wall Street. Those days are gone. Microsoft is the phoenix risen from the ashes.
Wall Street standing– reflected by a company’s stock price– is not always an indicator of a company’s health status, but suffice it to say that Microsoft gets valued on perceived financial health while Apple gets de-valued based on perceived financial health.
How is it the perception is different and yet the same?
Welcome to the shady underworld of the stock market where gambling is legal and legitimate. Raymond Wong on Microsoft:
While the ground all around Facebook burned (and continues to blaze), Apple was criticized for hiking up device prices and innovating at a slower pace, and social platforms made sweeping moves to combat fake news and their creators like Alex Jones, one tech company quietly rocketed to the top relatively unscathed with win after win.
What are those wins?
Microsoft remains crazy profitable but the company’s products have become more diversified under new CEO Satya Nadella.
With Nadella at the helm, Microsoft has diversified its portfolio beyond its bread-and-butter operating system, expanding to regions less sexy but increasingly lucrative and crucial to connecting our lives, like the cloud and “edge” computing.
Edge? Funny. Microsoft’s Edge browser is such a disaster that the company will adopt Google’s Chromium browser to use instead. Much less expensive, right? On the surface– pun intended– Microsoft seems to be cooking with gas. Hot. A closer look reveals what the Wall Street narrative does not mention.
Surface PC sales are not so hot; probably 1/10th to 1/5th that of Apple’s so-called moribund but far more profitable Mac sales. Strange standards, those Wall Street folks. Windows and Office remain cash cows, of course, but Microsoft doesn’t have much of a hardware business.
If I were to boil it down, I’d say Microsoft has masterfully blended the best of Apple and Google into one. Its core DNA is both hardware and software and the connectivity that ties them together.
Hardware? Microsoft now shows up in the Top 10 PC hardware vendors in the U.S., but the real money comes from services expansion, Windows and Office subscriptions, and– bear with me for a moment; I’m using Google to find something else– nevermind.
Microsoft has never been the strongest hardware maker. But this year, the Surface family outclassed even Apple, Google, and HP’s best.
Uh huh. In the minds of anti-Apple technology writers, most of whom are members of the technorati elite politburo which specialize in flowering narratives to gin up competition where none exists.
Microsoft does not have a tablet. It has a cheap-assed PC notebook with touchscreen options. That does not a tablet make. Also, Surface sales this past year are mostly flat from the year before which seems to indicate Microsoft has taken another page from Apple’s book of stagnation.
Apple’s fast growing Services business is the envy of competitors and the darling of even Apple’s critics, but let’s remember one thing. Apple is a hardware company. Microsoft sells hardware. They are not the same. If Surface sales fell off the planet, Microsoft has other revenue streams. If hardware sales fell off the planet for Apple, Services would not grow.
Microsoft is no Apple so let’s stop equating them as if they are the same.