Would replacing Ballmer really goose Microsoft's stock price?
Summary: It's hard to know what Microsoft could do to raise its stock price, which has been stuck in a holding pattern for the past ten years or so.
It's hard to know what Microsoft could do to raise its stock price, which has been stuck in a holding pattern for the past ten years or so.
Strong earnings reports don't seem to affect the Microsoft stock price much. Nor has Microsoft's implementation of cost-control measures, including layoffs. Launching the fastest-selling consumer device didn't help. Nor did buying one of the biggest consumer brands out there.
The latest suggested quick fix for Microsoft's lagging earnings: Fire the CEO. One prominent hedge fund leader is calling for Microsoft's board to oust Steve Ballmer because he is out of touch and stuck in the past.
There were no suggestions from David Einhorn, head of Greenlight Capital -- and owner of just .11 percent of Microsoft's outstanding shares -- as to who might better fill the Microsoft CEO shoes. Instead, Einhorn echoed what a lot of former Softies and other Wall Street watchers have been saying privately, and in some cases, publicly.
As my ZDNet colleague Larry Dignan notes "Einhorn would have to rally a lot of shareholders to his boot Ballmer cause." The two biggest Microsoft shareholders are Chairman Bill Gates and Ballmer himself.
I think replacing Ballmer would be a lot trickier than many think.
Microsoft isn't a company that has a good track record of outsiders (i.e., non-career Softies) thriving. But are there any Softies at the top echelons who have the skill set, personality and cross-company knowledge to run Microsoft? Chief Operating Officer Kevin Turner is often mentioned as a possible (though not necessarily popular) internal replacement. I've seen a number of company watchers suggesting Windows President Steven Sinofsky or President of Interactive Entertainment Don Mattrick. Personally, I'm not sure either of these tech-savvy guys have the breadth of product knowledge or the business savvy needed to be CEO.
We're all nothing but armchair pundits, of course (including Einhorn). I'm curious if any of you readers have suggestions beyond the usual Sinofsky, Mattrick ones. I have to say, even if Microsoft does replace Ballmer in the short term, I am doubtful that the move will please fickle Wall Street analysts who seem to have already decided, in large part, that Microsoft is now more of a Procter & Gamble than an Apple, Google or even IBM competitor....
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Talkback
You can get a CEO, but they still will be part of the board
Gates/Ballmer don't own a majority
If you don't want to change anything, and just want to continue merrily going along on the trajectory of the last ten years, with Bings and Bangs and Zunes and Kins and a great deal of dead weight at the company, then no point in making any management changes at all.
If you're an unsentimental shareholder, or collection of them, and you want the stock price to double and double again, you need to get rid of the current management.
RE: Would replacing Ballmer really goose Microsoft's stock price?
Only a CEO like Linus or Stallman can right the M$ ship!
Gates owns 8% of Microsoft and Ballmer owns 4% ...
Ballmer may be a buffoon but, unless Microsoft begins to lose market share in its core offerings, I see no reason to fire Ballmer.
Microsoft stock may not have appreciated much in the last ten years but many companies have done worse.
Fainlly, as companies like MS get bigger, and as they saturate their own market, the value of their shares is likely to stablize as a matter of course.
Gates and Ballmer ownership - 12%
While your math is correct, your logic is not...
it would be a [i]whole[/i] lot harder to get the multitude of people who own that 51% to agree, than it would for the 2 people that own the 12%.
Yep good point
That will work for a long time. Until someday it doesn't, maybe many years from now. When it does happen people will say, 'my goodness it happened so suddenly.'
Weird description of "trajectory."
Why are Zune and Kin more representative of Microsoft's trajectory than Win7+, Azure, Xbox, Kinect, and WP7? You were right to include Bing, but I've never heard of Microsoft Bang.
Microsoft's problem isn't dead weight, it is inefficient utilization of their impressive talent. But the past few years have shown that when they get behind something, they deliver in a big way.
RE: Would replacing Ballmer really goose Microsoft's stock price?
Nobody wants Wp7... Its the biggest Fail.
Hardly. You live in dreamland.
Why is it people just think that its cool to throw out some moronic comment like "Nobody wants Wp7" when in fact plenty want it. I mean, where does something like that kind of comment even come from, except from someone who simply has a hate on for Microsoft and wants to display it in the most ludicrous fashion?
RE: Would replacing Ballmer really goose Microsoft's stock price?
except, of course, for the 350+ million who already bought it. Funny though, I don't hear too many complaints.
RE: Would replacing Ballmer really goose Microsoft's stock price?
RE: Would replacing Ballmer really goose Microsoft's stock price?
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RE: Would replacing Ballmer really goose Microsoft's stock price?
Aaaah the myth of the CEO.
While you may think it makes a difference, it really doesn't.
Fire him and don't replace him then
MS needs to get better value for it's expenditure. They need to release more products. Maybe one day they'll get it.
RE: Would replacing Ballmer really goose Microsoft's stock price?
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RE: Would replacing Ballmer really goose Microsoft's stock price?
RE: Would replacing Ballmer really goose Microsoft's stock price?
*Source: http://asia.gamespot.com/news/6313539/xbox-360-tops-april-console-sales-kinect-library-to-triple-in-2011
RE: Would replacing Ballmer really goose Microsoft's stock price?
<i>Microsoft developed a solid platform in Xbox and now its the highest selling console.</i>
Sources please, everything I have read indicates that the xbox 360 is in last place out of the three consoles. I am talking out active installed base, not simply units shipped.