After the earnings announcement Microsoft shares to a 11 years low

Thursday, Redmond, Wash.-based software giant posted worse-than-expected results for the second quarter, missing earnings by 11%. The company blame the performance on falling sales of PCs. MSFT (Microsoft Corporation) dramatically revenue and earnings miss Thursday validate its decision to expand beyond its core software franchise. Analysts said Microsoft must pull out of the profitability of its other projects, including in their attempts to become a force in online advertising. Hernández said that part of the reason why investors pushed Microsoft shares to a 11 year low after the earnings announcement - shares closed 11.7% lower at $ 17.11 - was because they were concerned about the company's revenue mix.
More than 80% of the $ 22 billion in annual profits in 2008 came from either operating system or Office suite of software that runs on it.Microsoft's profitability is still bound to its core. Although Microsoft has done a credible success on the road to the server that generated $ 4.5 billion surplus in 2008, worked to spread, like its Xbox machine and Zune music player has created little in the form of profitability.But investors more aware of the company face challenges from a wide range of companies that have an edge in the market it targeted. These include the Apple devices, and Google Inc. (GOOG), dominant on the Internet and moving aggressively in Microsoft's turf by offering free software, as Mimics Office applications. Google has also built an operating system for mobile phones, challenging Microsoft in a different area where it had established itself.
The results underscore Microsoft's symbiotic dependence on personal computers, a relationship that is vital to our success, which can be a liability. Its Windows operating system ships over 90% of the world's computers and Microsoft with third party manufacturers and suppliers, enabling them to customers who have secured their sales and profits in the past. Now, with sales of PCs fall, so is Microsoft's revenue.
MS Company Meeting-