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  (Source: Reuters)
Amid low share prices, Ballmer received a chilly reception from some shareholders at their annual meeting

At Microsoft Corp.'s (MSFT) annual shareholder Wednesday, the company's at-times boisterous Chief Executive Steven "Steve" Ballmer brought in Microsoft's "big guns" -- former Microsoft CEO, co-founder, and tech icon Bill Gates and Chief Financial Officer Peter Klein.  But at the meeting of 450 shareholders, Mr. Ballmer did not need to enlist the help of his fellow Microsoft elite, who remained silent even as the meeting turned chilly, according to Reuters reporters in attendance.

Amid tough questions from the audience, Mr. Ballmer was candid in his assessment that Microsoft was a late-comer to the tablet game, but he told the audience in a fiery defense that he saw "nothing but a sea of upside" for Windows 8 tablets.  He comments, "We're innovating on the seam between software and hardware.  Maybe we should have done that earlier.  [But] I feel pretty good about our [current] level of innovation."

Indeed, Microsoft has some defenders in odd places.  Stephen "Steve" Wozniak, better known as the "Woz", was once a ferocious critic of Microsoft and evangelist for Apple, Inc. (AAPL), the company he co-founded.  But today he said in a recent TechCrunch interview that he fears for Apple because Microsoft has become more innovative.

Steve Ballmer
Steve Ballmer is overwhelmed with anticipation regarding his company's
prospects in the tablet market. [Image Source: Getty Images]

Others might disagree.

While Mr. Ballmer pointed optimistically to Windows Phone sales quadrupling on a year-to-year basis, the platform is still estimated to only own 2 to 4 percent of the global market, well behind Apple and market leader Google Inc. (GOOG).  While Microsoft dreams of "pulling a Google" and rising to the top of the stack, it currently is resigned to vying with embattled Research in Motion, Ltd. (TSE:RIM) for the third-place spot.

But when it came to shareholder criticism, the harshest questions came not about Microsoft's products, but rather why its share price was so low.  Indeed, Microsoft shares trade at an order of magnitude lower than their Google and Apple counterparts.  (To be fair Microsoft has significantly approximately 9 times as many shares as Apple, and 25 times as many as Google).  Apple recently passed Microsoft in market capitalization and today has a total stock value that is more than twice that of Microsoft's.

Steve Ballmer dodged the share value question, remarking, "I understand your comment... [but Microsoft has] done a phenomenal job of driving product volumes... The stock market's kind of a funny thing."

Funny indeed, but the shareholders might have been less than amused.  Mr. Ballmer did placate the critics slightly by pointing to Microsoft's $10B USD profit sharing effort which includes share buybacks and quarterly dividends.

Currently, Microsoft shares are trading at around their levels from a decade ago, having risen roughly 18 percent in 2012.  In other words, despite the criticism, shareholders should be pleased to an extent that Microsoft outperformed the Standard & Poor's 500 average of an anemic 3 percent in gains.

Source: Reuters



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RE: Ballmer is the worst
By TakinYourPoints on 11/29/2012 9:57:37 PM , Rating: 3
To be fair, this piece from the article is nonsense:

quote:
Microsoft peaked at $60/share in 2000, just as Mr. Ballmer took the reins. By 2002 it had fallen into the $20s, and has only rarely made it back to its current low $30s value.


Microsoft's peak was during the dot-com bubble. At the time they were valued at a ridiculously high price to earnings multiple of about 45. If Apple was valued the same way right now then it would be trading at over $2000 per share.

Microsoft has consistently grown revenue year over year on the back of Windows and Office, and they make far more now (even adjusted for inflation) then they did when the stock was at its peak. Sure, they missed out on the search/ad revolution of Google and played second fiddle to Apple's advances in mobile devices, operating systems, and interfaces for laptops, but they also grew their influence (and profits) in enterprise and the back-end. Huge business there.

Microsoft's drop in stock price isn't because the company has been performing poorly, it is because it was insanely overvalued at its peak. To criticize Ballmer's performance on the basis of stock price within this context (investor mania) is asinine.


RE: Ballmer is the worst
By StevoLincolnite on 11/30/2012 5:27:55 AM , Rating: 2
You can't forget that Microsoft has done multiple stock splits in the past either, which can drive the value per-stock down.
I'm pretty sure Apple hasn't done one of those in recent times.


RE: Ballmer is the worst
By ElConquistador on 11/30/2012 11:40:52 PM , Rating: 2
But just look at the last 5 years:

Microsoft stock price: -21%
NASDAQ: +13%

That's pretty bad ...


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