Analyst Concerned About Microsoft, Intel on China Weakness
Microsoft seems a natural companion for the growing concern surrounding PC sales. If PC sales stagnate, Microsoft is more than likely affected, given the fact that Windows accounts for about 36 percent of the company's revenue.
So it is not surprising that analysts and investors are adding Microsoft on a growing watch list, especially since China may not be able to bailout Microsoft.
Analysts predict that Microsoft will post a sales growth of less than 5 percent from a year ago for the second quarter. A article published by Bloomberg suggests that China can't flatten the valley created by slow demand in the U.S. and Europe, and may even worsen it by a more and more pronounced weakness in the market. One analyst called the outlook for this year "lousy" while another said that the PC industry may struggle to grow at all in 2012.
What makes this quarter rather interesting is the fact that there is a certain doubt that Intel will be doing well - or, at the very least, better than AMD. Typically, AMD has been much more affected my market swings than Intel, as Intel's market power often allowed it to balance out downturns. This time, however, there are plenty of voices that predict that Intel may be hit much harder than in previous times. There is also doubt that Intel will admit that it has been hit. Bloomberg quoted one analyst from Susquehanna International Group who believes that Intel will show optimism simply to keep its customers ordering products.
"Intel realizes that their view of the market influences the market because they are the market," said Susquehanna's Chris Caso. "They're trying to convince customers, investors and eventually the consumer that they're right." Intel will report Q2 results on Tuesday, AMD will follow on Thursday. Microsoft will reveal Q2 results on Thursday as well.
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Douglas Perry was a freelance writer for Tom's Hardware covering semiconductors, storage technology, quantum computing, and processor power delivery. He has authored several books and is currently an editor for The Oregonian/OregonLive.
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amuffin Intel would never manufactuer their chips in China, if they did, next thing you know there's going to be a copy!Reply -
amuffin x4dmamuffin... so you are saying Dalian, China is not in China?Didn't notice that...*facepalm*Reply -
blazorthon Douglas Perry's article, second to last paragraphWhat makes this quarter rather interesting is the fact that there is a certain doubt that Intel will be doing well - or, at the very least, better than AMD. Typically, AMD has been much more affected my market swings than Intel, as Intel's market power often allowed it to balance out downturns. This time, however, there are plenty of voices that predict that Intel may be hit much harder than in previous times. There is also doubt that Intel will admit that it has been hit. Bloomberg quoted one analyst from Susquehanna International Group who believes that Intel will show optimism simply to keep its customers ordering products.Reply
Should that word that I put in bold be "by", not "my", or am I somehow reading this incorrectly? -
Jerom PinheddSince when do people in China actually pay for software? Software sales was always about companies and industries and those always pay for software.Reply -
_Cubase_ ReplyBloomberg quoted one analyst from Susquehanna International Group who believes that Intel will show optimism simply to keep its customers ordering products.
It takes an analyst to figure this out?
Or was the whole "lets show our customers how pessimistic we can be" a genuine option?
Coming up next: Analyst predicts that bad sales mean sales will be bad! But company most likely won't tell customers that they are actually drinking themselves to sleep every night in a pit of sorrows. -
blazorthon JeromSoftware sales was always about companies and industries and those always pay for software.Reply
There is something like a billion people in china. Let's say that even only one percent of them buy a copy of Windows and/or MS Office in the next year. Theoretically, that's potentially one to several billion dollars' worth of revenue. Are you going to pretend that this isn't impacting, especially if piracy cuts down on it severely? -
Belardo When you own 95% of the desktop market, you can only go down.Reply
Windows8 will not generate any additional PC sales, if anything - it will lower PC sales.
Then theres going to be containers full of MS-tablets that only specialist and a few thousands PC geeks actually buy.