Microsoft Corp., one of the world's biggest tech companies, sells personal computing devices, cloud systems and services, software and other products. Microsoft is listed on the Nasdaq exchange under the ticker symbol, MSFT.
The company was founded in 1975 by Bill Gates and Paul Allen in a garage in Albuquerque, New Mexico. Five years later, Gates and Allen were hired to provide the operating system for IBM's first personal computer, followed in 1985 by Microsoft's launch of its now ubiquitous Windows software product. In 1986, the company raised $61 million in an initial public offering (IPO) that some analysts referred to as "the deal of the year." By the late 1980s, Microsoft became the world's largest personal-computer software company. The Redmond, Washington-based company's stock rose more than a hundred-fold in the ten years after the IPO, and today it's one of the world's largest companies by market value.
With products geared toward both consumers and businesses, Microsoft competes in a broad range of industries against companies including Apple, Inc. (AAPL), Amazon.com Inc. (AMZN), International Business Machines Corp. (IBM), and Oracle Corp. (ORCL).
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Microsoft's Latest Developments
- On June 11, 2021 five draft antitrust bills were introduced into the House of Representatives. While they have not passed committee hearings yet, the passage of any of the bills would likely mean substantial changes for the way Microsoft does business. The bills are the Ending Platform Monopolies Act, the American Choice and Innovation Online Act, Platform Competition and Opportunity Act, the Augmenting Compatibility and Competition by Enabling Service Switching (ACCESS) Act, and the Merger Filing Fee Modernization Act. Examples of major antitrust changes these bill introduce include forcing dominant online platforms to prove that their acquisitions are not monopolistic, rather than the FTC proving they are not and making it harder for platforms to advantage their own products or services.
- On June 2, 2021, Microsoft announced scheduled for June 24, 2021, at 11 a.m. EST to debut "what's next," for its windows operating system." In addition to this, an end date of October 14, 2025 was announced for support for its Windows 10 operating system, which it had previously said would be the last. This created speculation Microsoft was announcing a "Windows 11" operating system. This speculation was seemingly confirmed when what appears to be a beta version of Windows 11 leaked on June 15, 2021 on Chinese discussion forum Baidu Tieba.
- On May 27, 2021, Microsoft announced that they "observed cyberattacks by the threat actor Nobelium targeting government agencies, think tanks, consultants, and non-governmental organizations. This wave of attacks targeted approximately 3,000 email accounts at more than 150 different organizations." Nobelium is the name Microsoft has given to the entity involved in the Solarwinds hack last year, who appears to originate in Russia. The hackers got into the Constant Contact account (an email marketing service), of the United States Agency for International Development (USAID), and used the account to send out phishing emails that appeared to come from USAID. Nobelium is believed to be associated with the Russian foreign intelligence service SVR.
- On May 19, 2021, Microsoft announced that it would be retiring Internet Explorer on June 15, 2022, in favor of Microsoft Edge.
- On May 10, 2021, The Wall Street Journal reported that officials at the Defense Department are considering dropping the $10 billion contract for the Joint Enterprise Defense Infrastructure (JEDI) that was given to Microsoft in 2019. The contract is currently stuck in a protracted court case as Amazon, one of the original contenders for the contract, claims that Microsoft was awarded the deal unfairly based on political influence. The case doesn't seem like it will be going anywhere soon as a federal judge rejected the Pentagon's motion to dismiss the case in April 2021.
- On April 27, 2021, Microsoft reported earnings for Q3 FY 21, the quarter ending on March 31, 2021. It reported revenue of $41.7 billion and adjusted earnings per share (EPS) of $1.95. Both of these figures were higher than analysts' expected. Revenue from Microsoft's key Azure cloud computing platform grew by 50% year-over-year (YOY), more than the 46.3% analysts had predicted.
- On April 19, 2021, the Prime Minister of Malaysia announced that Microsoft would invest $1 billion in the country over the next five years. The investment would come in the form of building multiple data centers and helping up to 1 million Malaysians to acquire digital job skills.
- On April 12, 2021, Microsoft announced it was acquiring AI and voice recognition software firm Nuance Communications for $19.7 billion, including debt. Microsoft says it intends to use the acquisition to, among other things, help further its efforts to push Microsoft Cloud services for the healthcare industry, which is has been a major market for Nuance. The two companies intend to close the deal later this year.
- On March 8, 2021, the European Commission approved Microsoft's $7.5 billion purchase of videogame company ZeniMax Media, clearing the largest antitrust hurdle to the acquisition. ZeniMax is the parent company of videogame publisher Bethesda Softworks.
- On March 2, 2021, Microsoft announced that there was a state-sponsored cybersecurity threat they had dubbed "Hafnium," who was based out of China. Halfnium's attacks targeted a Microsoft product called Microsoft Exchange Servers, an email and calendar server product. Microsoft released a series of patches for Microsoft Exchange Servers. However, there has been a major issue with the patches, if you try to install the patch without running it as administrator, the patch won't fully update the correct files, but no error message indicating the patch isn't working will show up, making it seem as though it installed properly even though it didn't work. Bloomberg reported that there are "at least 60,000 known victims globally."
Frequently Asked Questions
How Profitable Is Microsoft?
Microsoft made over $15.5 billion in net income for the quarter that ended March 31, 2021, a 44% increase over the year before, according to its most recent quarterly report. The report, released on April 27, 2021, showed that Microsoft's revenue for the quarter was $41.7 billion, a 19% year-over-year (YOY) increase; its earnings per share (EPS) was $2.03, a 34% YOY increase; and its adjusted EPS was $1.95, a 39% increase. Revenue for its key Azure cloud computing service grew 50% YOY.
Who Owns the Most Microsoft Stock?
The biggest individual insider shareholder of Microsoft is Satya Nadella, who owns 1,337,768 shares of Microsoft stock at last count, representing 0.02% of total shares outstanding. Nadella has served as Chief Executive Officer (CEO) of Microsoft since 2014, and first joined Microsoft in 1992.
The biggest institutional shareholder of Apple is Vanguard Group, which owns 640.2 million shares of Microsoft, representing 8.4% of total shares outstanding, according to the company's most recent 13F filing for the period ending March 31, 2020.
Who Invented Microsoft Windows?
Bill Gates, co-founder and former chair and CEO of Microsoft Corp., created Windows with his team at Microsoft in the 1980s. The original Windows 1 was released in November of 1985. It was the company’s first major attempt at a graphical user interface in 16-bit. The operating system ran on top of MS-DOS, which relied on command-line input.