Thursday, April 14, 2011

Microsoft (MSFT) Faces PC Challenges Earlier Than Thought

Data from research firm IDC reveals worldwide PC shipments have dropped 3.2 percent in the first quarter against last year's shipments, missing the expected growth estimate of 1.5 percent, and challenging Microsoft (NASDAQ:MSFT) in that segment earlier than expected.

The results are a surprise because most were looking for tablet sales to eat into PC sales in a little farther out, suggesting this isn't tablet sales slowing the shipments, but more than likely the ongoing weak economy and rising inflation.

Also at risk in the current quarter is the effect of the Japan earthquake and rising fuel and food costs on the industry.

Businesses were also slow to add computers, adding to the weak shipment figures.

Microsoft closed Wednesday at $25.63, down $0.01, or 0.04 percent.

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