Microsoft faces hard questions over smartphones and PCs
Published 25/10/2010 | 11:48
Microsoft will face pressure this week to explain to Wall Street how it will wrest sales from Apple and Google in the rapidly expanding market for smartphone software.
The world's biggest software company is expected to spend hundreds of millions of dollars in the coming months marketing its Windows Phone 7 operating system.
Steve Ballmer, Microsoft's chief executive, said in June that the company had "missed a whole cycle" in developing software for mobile phones.
The Seattle-based company will be quizzed when it reports its financial results for the last quarter on Thursday.
Microsoft is forecast to produce profits of $4.81bn (€3.43bn) on sales of $15.8bn, up from $4.52bn and $15.3bn in the prior quarter, respectively.
Despite the predicted jump, Microsoft watchers on Wall Street and Silicon Valley will be eager to hear about the strength of consumer demand for computers given the fragile recovery in the world's biggest economy.
"One area of concern is slowing consumer demand for PCs," said Colin Gillis, a technology analyst at BGC Partners.
Demand for Microsoft's operating software used in PCs is often employed to gauge demand for computers given that the company enjoys about a 90pc share of the market.
There is some evidence that the faltering economy is catching up with hard-pressed consumers.
For example, the growth in PC sales in the US slowed to 11pc between July and September compared to 22pc in the three months prior to that, according to research firm IDC.