At the end of 20th century, Microsoft (News - Alert) was the world’s technology leader. Microsoft stock prices were at an all-time high. Later, the company announced a major change. Bill Gates, the well-known college dropout, handed the ball to Steve Ballmer (News - Alert), a long-time Microsoft employee and MBA dropout. It was downhill from then on, with Microsoft enduring over a decade of decreasing revenue.
Microsoft's Dark Years
It was a disastrous start of the century for Microsoft as the company's virtual monopoly was challenged and too unwieldy to survive. Their traditional sources of revenue, Windows OS and Office had fallen. The need for a traditional PC fell as well. At the same time, internal problems, like their system of performance reviews, promoted negative internal competition. This exposed very serious cracks in the foundation of the company. It was not a good decade for Microsoft.
Microsoft's Attempts to Recover
The company put up a good fight and refused to give up on its famous brand. Faced with a dwindling market for the beloved personal computer (PC), they shifted their focus of their OS to new products and cloud services. Most recently, a major reorganization was undertaken in the hope that a fresh blood will help stop the loss. The adjustments, slow as they were, seem to be working. Their first quarter showed that they made a profit of $5.2B, or 62 cents per share.
Investors are watching very closely to see whether or not these changes will alter the course of Microsoft's history. Steve Ballmer has announced that he is ready to hand over the company in a year's time.
No one predicted Microsoft's spiral. Despite the challenges they have faced, it has still remained a profitable company. If Microsoft continues to progress swiftly, it might reclaim – or at least get closer – to its former glory.