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by leaffig 4686 days ago
>As AllThingsD‘s John Paczkowski wrote on Friday: “Here’s one metric by which Ballmer will be judged harshly. On the last day of 1999, the day before he took over as CEO, Microsoft’s market capitalization was $600 billion

That fails to take into account, the crazy dotcom valuation days and the subsequent big crash in 2000. Not to say that Ballmer did great as a CEO but that's just poor reporting. Microsoft did have its great growth days, like Apple recently did before petering out, but it was back in the 80s.
2 comments
sytelus 4686 days ago
Even when you compare post-bubble market cap, say from 2002 to now, it's shockingly bad performance for Microsoft:

AAPL: $5 billion -> $465 billion

GOOG: $16 billion -> $288 billion

MSFT: $217 billion -> $291 billion

I know now you might nitpick that AAPL and GOOG were very small in 2002 and not comparable to saturated markets Microsoft operates in. In that case, take example of even non-tech well established companies:

AT&T: $72 billion -> $203 billion

StarBucks: $7 billion -> $53 billion

However you can still argue that Microsoft increased its revenue 3 folds and profit 2 folds under Ballmer. That might be good metric to measure Ballmer's performance but this does not discount for inflation (36%) and auto-accumulating multi-year enterprise contracts that have been pilling up since Gates era (unknown value).

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shalmanese 4686 days ago
This is largely an artifact of survivorship bias.

If you compare MS to it's peers:

GE: $372B -> $239B

MS: $326B -> $239B

Exxon: $299B -> $403B

Wal-Mart: $273B -> $247B

Citigroup: $255B -> $134B

Pfizer: $249B -> $207B

Intel: $203B -> $108B

BP: $200B -> $130B

Source: http://en.wikipedia.org/wiki/List_of_corporations_by_market_... http://www.ft.com/intl/indepth/ft500

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smackfu 4686 days ago
So the revenue went up 3x and profit 2x, and the valuation stayed flat, and that is a failure of the company? What crazy world are we living in?
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joshuaheard 4686 days ago
Agreed, it fails to take into account the Clinton DOJ anti-trust lawsuit against Microsoft which basically popped the dotcom stock bubble. The stock has remained flat then grown steadily since. The article also fails to mention the growth of annual revenue which has raised steadily and has tripled under Balmer's watch.

At the moment, Microsoft stock pays a 3% stock dividend which is a pretty good investment return, so it's less important for the stock to appreciate.

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