Comments on: Nokia and Microsoft – End of days?

By: windsorr

windsorr — Wed, 11 Sep 2013 04:02:42 +0000

That’s no surprise, shareholders are worried about how much capital this investment is going to drain and whether it will realy make money. In a reasonable smartphone business I would have thought that $30 is comfortably achievable. These numbers are not unachievabke because they are cumulative. At the current run rate, it will ship that many in jus over 4 years.

IF MSFT can turn this around it could be very valuable. that’s a BIG IF!!!

By: Adam Nealis

Adam Nealis — Wed, 04 Sep 2013 10:54:47 +0000

Interestingly, MSFT’s stock price is now below where it was before the “irrational exuberance” reaction to the anouncement of Steve Ballmer’s departure.

http://scharts.co/1dOqC0a

I read elsewhere (http://www.theregister.co.uk/2013/09/03/microsoft_nokia_rise_of_elop/) they will expect to earn $40 per unit sold, versus $10 today. To make back $7.1 billion means they need to sell 175,500,000.

Also from http://www.theregister.co.uk/2013/09/03/microsoft_nokia_rise_of_elop/

“Microsoft reckons it’ll have shifted 1.7 billion smartphones by the end of 2018, with an “assumed market share” of 15 per cent bagging $45bn in annual revenue.”

That’s 10 times the break-even figure above. What is their current sales rate, and how fast is it growing? How feasible is this target?

By: windsorr

windsorr — Tue, 03 Sep 2013 15:56:24 +0000

That is a very valid argument…HOWEVER…if a miracle happens and MSFT makes it work then there is a LOT of value here…its ALL about execution!.

By: Adam Nealis

Adam Nealis — Tue, 03 Sep 2013 15:49:16 +0000

It’s another Skype-like move by MS.

Like the previous Skype owners, they get to cash out at a premium.

Like Skype, MS might have overpaid for this.