8 ms·

People tend to see performance of CEOs by stock price. While it makes sense as shareholder, it's a very narrow view. From revenues as well as profit perspective

People tend to see performance of CEOs by stock price. While it makes sense as shareholder, it's a very narrow view. From revenues as well as profit perspective Ballmer actually grew Microsoft more than Nadella. Market just decided not to reward that. Current growth centers including Azure, Surface etc were all started and championed originally by Ballmer. It was Ballmer who was willing to pour in investment like crazy in Hololens as well Bing. On the other hand, Nadella has failed to add single new product in Microsoft's portfolio during his half decade as CEO. Microsoft today has simply no presence in home automation, smart assistants, wearable or self-driving markets that have emerged during past 5 years. Nadella has literally missed boat in every single new category that has came around during his time. All the while its rivals have moved fast and picked up top spots in these new markets. Windows revenues is still falling like crazy and obviously there is no Smarthone story from Nadella yet. The only thing that is compensating all these troubles is cloud and that too had been hazy on actual utilization. The engineering execution in Azure begs a question about how much worse it can get. Out of all providers, Azure literally has been the least impressive from technical standpoint in everything from UX to availability to features to documentation to API design. Once cloud market saturates and race to bottom ensues, Microsoft could have big trouble in maintaining current revenues and profits due to lack of new products. It will take few quarters before stock market reacts but all of these same people praising Nadella right now would suddenly come around and brand him the worst CEO in history as soon as stock dips.

basetop 7y ago
This tends to happen in every major bull market. The CEOs get an undeserved amount of credit. Nadella's been CEO only since 2014. Since then MSFT market cap gained $650 Billion in value. That's not all Nadella. It's simply the bull market and a strong economy boosting everyone's market cap. The market keeps hitting new record highs and that's helping a lot of stocks https://markets.businessinsider.com/news/stocks/stock-market-hit-record-high-history-says-they-are-headed-higher-2019-4-1028135907 https://markets.businessinsider.com/news/stocks/stock-market... On the flip side, CEOs tend to get an undeserved amount of blame during recessions and market declines.
spdionis 7y ago
Or you may say that Nadella chose to focus on improving Microsoft's core business products to maintain the company's leadership in those areas through quality instead of chasing new industry fads.
- telltruth 7y ago
  If you have ever interacted with Azure, you might have found that quality is far less of a focus then selling it at any cost. It's a model Oracle has practiced for long time. Just go give it a spin at portal.azure.com. Also, these new markets are absolutely not fed. Smart speakers is already $7B market, Apple/Android/Fitbit wearables at $10B and along with smart home are the fastest growing markets. No one now doubts if cars would self-drive in 5-10 years. That would be a market that would transcend economies of many countries and industries.
  - tallanvor 7y ago
    They're actually heavily focused on consumption, not just sales. The portal could be better, but all of the large cloud providers have areas of difficulty there. For the basics like spinning up a VM, it's pretty easy these days.
  - scarface74 7y ago
    Neither Fitbit or Android wearables are exactly shining beacons of success technically or in terms of profitability. The smart speaker business is also a no profit business.
skookumchuck 7y ago
I'm not buying any home automation crapware that routinely spies on me inside my house, either by design or by being comically easy to subvert with spyware.
- telltruth 7y ago
  There are 118 million customers who are ok with it, however.
  - scarface74 7y ago
    And that’s a full of people buying $40 speakers....
sumedh 7y ago
> obviously there is no Smarthone story from Nadella yet. probably because that boat has sailed.
dageshi 7y ago
> Microsoft today has simply no presence in home automation, smart assistants, wearable or self-driving markets that have emerged during past 5 years. Good, Microsoft spent a decade building "me too" products that weren't that good and even if they were nobody used anyway. Jumping on bandwagons too late didn't help them at all in fact it made them look like a bit of a joke.
fxfan 7y ago
Ballmer was also hamstrung by the 10 year antitrust deal
jillesvangurp 7y ago
Balmer started (and continued) a lot of things and he made a lot of money for MS mainly by riding the post windows 95 boom of milking office + windows licenses. By the time he left, the dependence on those two as the primary source of revenue was becoming a problem because the market was changing. MS needed a few of the things he started to actually become major revenue drivers. Windows Phone already looked like it was flopping and MS needed to be part of mobile to continue to stay relevant with its consumer software. On the server, people were flocking to AWS to run Linux software, which was very much a second class citizen on Azure under Balmer. Nadella fixed these problems and now office and azure revenues are doing great and even Windows is not looking too bad these days. This is why MS just crossed the 1 trillion $ valuation point. That would not have happened under Balmer.
saiya-jin 7y ago
What sours MS for me these days how messed up Win10 is. Utter disregard of what users want, utter disregard of privacy is intolerable in 2019. I don't care about the rest, they can be stellar. Its the same company, same top management making these decisions. If somebody makes 8 nice and 2 evil decisions, these don't cancel out.
scarface74 7y ago
Microsoft today has simply no presence in home automation, smart assistants, wearable or self-driving markets that have emerged during past 5 years. Home automation and smart assistance as platforms are profit loss centers to either invade user privacy in the case of Amazon and Google or as a moat for more profitable hardware in the case of Apple. Microsoft has positioned itself as a neutral platform provider with Azure. There is no real money in the home automation market. The only people who make money in a gold rush are the people who sell shovels. Wearables outside of the Apple Watch aren’t doing too well either. There is no “self driving market”. There might be one in the future. Windows revenues is still falling like crazy and obviously there is no Smarthone story from Nadella yet. There is a story. Microsoft is supporting both Android and iOS with appps, development tools, and Azure. Seeing that Google has only made $21 billion in profit on Android in its entire existence (came out in the Oracle trial), and that most phone manufacturers are losing money, the entire phone market is low profit margin business for anyone who isn’t Apple, the carriers, or component suppliers (ie Samsung). As far as cloud, it’s a lot easier to convince a company to use Azure than GCP and their relative market share shows as much.
ksec 7y ago
> Current growth centers including Azure, Surface etc were all started and championed originally by Ballmer. It was Ballmer who was willing to pour in investment like crazy in Hololens as well Bing. Is Surface really a growth centers? Azure is Linux. Without Linux Azure don't mean a much, and without the goodwill that is coming from Nadella, developers are not going to deploy anything on Azure. Having said that we still don't know how much Azure is within the Cloud Business, which includes Office 365. Microsoft, by and large is a company that does more business to developers and Enterprise than to Consumers. How many consumers have actually spent money buying or upgrading Windows? Without the brand images changes and good faith, how many of those I.T people were willing to continue put money into their products? >It was Ballmer who was willing to pour in investment like crazy in Hololens as well Bing. And we know how both of those ended. There are definitely a lot more new things Microsoft could do. But he managed to turn the 2nd most hated company in the industry, ( First will definitely be Oracle ) and now with people thinking Microsoft have redeemed themselves, all while growing its business revenue and profits.

basetop 7y ago

This tends to happen in every major bull market. The CEOs get an undeserved amount of credit. Nadella's been CEO only since 2014. Since then MSFT market cap gained $650 Billion in value. That's not all Nadella. It's simply the bull market and a strong economy boosting everyone's market cap. The market keeps hitting new record highs and that's helping a lot of stocks https://markets.businessinsider.com/news/stocks/stock-market-hit-record-high-history-says-they-are-headed-higher-2019-4-1028135907 https://markets.businessinsider.com/news/stocks/stock-market... On the flip side, CEOs tend to get an undeserved amount of blame during recessions and market declines.

spdionis 7y ago

Or you may say that Nadella chose to focus on improving Microsoft's core business products to maintain the company's leadership in those areas through quality instead of chasing new industry fads.

telltruth 7y ago
If you have ever interacted with Azure, you might have found that quality is far less of a focus then selling it at any cost. It's a model Oracle has practiced for long time. Just go give it a spin at portal.azure.com. Also, these new markets are absolutely not fed. Smart speakers is already $7B market, Apple/Android/Fitbit wearables at $10B and along with smart home are the fastest growing markets. No one now doubts if cars would self-drive in 5-10 years. That would be a market that would transcend economies of many countries and industries.
- tallanvor 7y ago
  They're actually heavily focused on consumption, not just sales. The portal could be better, but all of the large cloud providers have areas of difficulty there. For the basics like spinning up a VM, it's pretty easy these days.
- scarface74 7y ago
  Neither Fitbit or Android wearables are exactly shining beacons of success technically or in terms of profitability. The smart speaker business is also a no profit business.

skookumchuck 7y ago

I'm not buying any home automation crapware that routinely spies on me inside my house, either by design or by being comically easy to subvert with spyware.

telltruth 7y ago
There are 118 million customers who are ok with it, however.
- scarface74 7y ago
  And that’s a full of people buying $40 speakers....

sumedh 7y ago

> obviously there is no Smarthone story from Nadella yet. probably because that boat has sailed.

dageshi 7y ago

> Microsoft today has simply no presence in home automation, smart assistants, wearable or self-driving markets that have emerged during past 5 years. Good, Microsoft spent a decade building "me too" products that weren't that good and even if they were nobody used anyway. Jumping on bandwagons too late didn't help them at all in fact it made them look like a bit of a joke.

fxfan 7y ago

Ballmer was also hamstrung by the 10 year antitrust deal

jillesvangurp 7y ago

Balmer started (and continued) a lot of things and he made a lot of money for MS mainly by riding the post windows 95 boom of milking office + windows licenses. By the time he left, the dependence on those two as the primary source of revenue was becoming a problem because the market was changing. MS needed a few of the things he started to actually become major revenue drivers. Windows Phone already looked like it was flopping and MS needed to be part of mobile to continue to stay relevant with its consumer software. On the server, people were flocking to AWS to run Linux software, which was very much a second class citizen on Azure under Balmer. Nadella fixed these problems and now office and azure revenues are doing great and even Windows is not looking too bad these days. This is why MS just crossed the 1 trillion $ valuation point. That would not have happened under Balmer.

saiya-jin 7y ago

What sours MS for me these days how messed up Win10 is. Utter disregard of what users want, utter disregard of privacy is intolerable in 2019. I don't care about the rest, they can be stellar. Its the same company, same top management making these decisions. If somebody makes 8 nice and 2 evil decisions, these don't cancel out.

scarface74 7y ago

Microsoft today has simply no presence in home automation, smart assistants, wearable or self-driving markets that have emerged during past 5 years. Home automation and smart assistance as platforms are profit loss centers to either invade user privacy in the case of Amazon and Google or as a moat for more profitable hardware in the case of Apple. Microsoft has positioned itself as a neutral platform provider with Azure. There is no real money in the home automation market. The only people who make money in a gold rush are the people who sell shovels. Wearables outside of the Apple Watch aren’t doing too well either. There is no “self driving market”. There might be one in the future. Windows revenues is still falling like crazy and obviously there is no Smarthone story from Nadella yet. There is a story. Microsoft is supporting both Android and iOS with appps, development tools, and Azure. Seeing that Google has only made $21 billion in profit on Android in its entire existence (came out in the Oracle trial), and that most phone manufacturers are losing money, the entire phone market is low profit margin business for anyone who isn’t Apple, the carriers, or component suppliers (ie Samsung). As far as cloud, it’s a lot easier to convince a company to use Azure than GCP and their relative market share shows as much.

ksec 7y ago

> Current growth centers including Azure, Surface etc were all started and championed originally by Ballmer. It was Ballmer who was willing to pour in investment like crazy in Hololens as well Bing. Is Surface really a growth centers? Azure is Linux. Without Linux Azure don't mean a much, and without the goodwill that is coming from Nadella, developers are not going to deploy anything on Azure. Having said that we still don't know how much Azure is within the Cloud Business, which includes Office 365. Microsoft, by and large is a company that does more business to developers and Enterprise than to Consumers. How many consumers have actually spent money buying or upgrading Windows? Without the brand images changes and good faith, how many of those I.T people were willing to continue put money into their products? >It was Ballmer who was willing to pour in investment like crazy in Hololens as well Bing. And we know how both of those ended. There are definitely a lot more new things Microsoft could do. But he managed to turn the 2nd most hated company in the industry, ( First will definitely be Oracle ) and now with people thinking Microsoft have redeemed themselves, all while growing its business revenue and profits.