One slide shows Steve Ballmer was a pretty good CEO for Microsoft

Steve Ballmer announced his plans to retire as Microsoft's CEO a few weeks ago and ever since then, many members of the media have offered their opinions on Ballmer's long history in running the company. Some of those viewpoints have been quite harsh, and a few have called Ballmer the worst CEO ever.

On Thursday, Ballmer appeared on stage at the company's financial analyst meeting to address the crowd in Bellevue, Washington. Perhaps as a way to answer those people who have been critical of his leadership of Microsoft, Ballmer showed a slide to the analysts that listed various financial numbers of Microsoft and six of its competitors.

The slide, which was simply labeled as "Perspective", showed Oracle, IBM and Salesforce as examples of enterprise businesses, while Amazon, Google and Apple were listed as being more consumer oriented. Microsoft has its feet in both enterprise and consumer ventures. The chart shows that Microsoft competes very well and even beats many, if not all, of the six listed companies in those categories.

When referencing the chart, Ballmer stated:

But you take a look and you say, okay, how have we done? We've done pretty well in profit, very well in profit, in fact. Even if you look at just the last year with the exception of Apple, we're the most profitable company on the list. If you look at dividends until Apple started a dividend we are the biggest pay out. And now they've passed us. We just made our most recent increase. If you look at cash returned to shareholders, the last 10 years we kind of blow everybody away. And if you look at the last several years, IBM particularly through buyback has chosen to return cash.

Ballmer's presentation on Thursday showed that he was aware that the company's Windows business was facing new challenges and that the company currently has, in Ballmer's own words, "almost no share" in the mobile device market. However, he seemed optimistic that Microsoft could grow its presence in the mobile product industry.

Microsoft did not offer any information on the search for someone to replace Ballmer as CEO during the financial analyst meeting. However, Ballmer himself brought the subject up in his presentation. He said:

We made this decision to announce before we had a replacement so we could run the absolute best succession process on the planet. I've got to say it's kind of a little weird for me to come to work and have that kind of known, and yet when we talked it all through, we said this is absolutely the best way to ensure that the company gets the leader that it deserves for this incredibly talented team. Whether it's one of our people who works here or somebody from outside, we wanted to make sure to be able to do that incredibly thoughtfully.

Whomever is picked to be the new CEO of Microsoft will certainly be compared instantly to Ballmer. The big question is whether or not the new leader will be able to continue Ballmer's pretty impressive financial legacy, no matter what other pundits think of his leadership of Microsoft.

Source: Microsoft | Images via Microsoft

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38 Comments

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derekaw said,
Where is the slide showing all the lost opportunities, failed products and write downs?

You mean the regular stuff that happens to almost every company?

And btw profits include writedowns...

If he was good CEO the board and Bill Gates would not have decided to let him go. He missed really important opportunities and had lot failures I would not consider him a great CEO. He is typical short sighted CEO without making the correct long term bets.

If you purchase Microsoft products then Ballmer hates you and he hates you with an unbridled passion and so do the rest of the employees at Microsoft who prove this stark, simple fact each and every day.

On server and tools business Microsoft has done awesome job last 10 years. Windows Server was a joke 15 years ago, but now its the best Server OS. Azure is the most powerful cloud platform (which has a really intuitive interface by the way).
The only area they didn't do enough investment was the mobile and tablet and related technologies. MS was the first company created tablet yet still lagging behind google and apple. windows mobile smartphone was truly powerful, yet they ripped it off to a very primitive modern interface. with wp 8 and new surface line of tablets they are definitely stepping into right direction, they should accelerate however.

Actually he mentioned Samsung in that presentation; he didn't put it on the list because he said he Korea accounting practices were too complicated for him

LexL said,
Where is Samsung in all of this?
Aren't those all US company's? Samsung isn't a US company...are they?

Amazing how people can read the exact same info an someone can't read it properly. There is more to reading than knowing words and numbers. You have to understand context and comprehend.

someone should really plot the enterprise value / market cap vs timeline comparison chart of microsoft and apple for the past 10 years to see the actual damage incurred.

oh and ask ballmers to do his monkey dance one last time.

If you look closely you can see the profits for the past 5 years and 1 year indicate a decreasing trend. Profits are down across the board, however companies (like Apple) were more profitable over the past 5 years than MS and overall their downward trend of the other companies has not been as steep as MS.

That's due to the smartphone bubble which will not continue. You'll be seeing smartphones in convenience stores soon. That's unlike Microsoft's product base which is solid long term recurring which is why they're considered a blue chip stock.

deck said,
If you look closely you can see the profits for the past 5 years and 1 year indicate a decreasing trend. Profits are down across the board, however companies (like Apple) were more profitable over the past 5 years than MS and overall their downward trend of the other companies has not been as steep as MS.

That's an interesting theory. However simple math seems to disprove that. Their 5-year profit was 129bn, extended out another 5 years beats their 10-year profit of 220bn. Their 1-year profit of 28bn extended 10 years beats out their 10-year profit as well. They seem to be trending up, not down.

For smart readers and observers, this news should come with no surprise. MS have indeed been doing well compared to their competitors in some aspects, and lagging behind in others.

They made mistakes as well --there's no perfect company in this world, it's part of our human nature.

Contrary to what people belief on the internet, MS is still making profits and in many areas are ahead of its competitors --though they've lost in some areas too. Unfortunately, media and the internet is not so friendly to MS. So much so that they'll get bashed for every small mistakes or 'brave' attempts they make. I understand there are people out there who wanted for Microsoft to be 'defeated' and broken so they can take advantage of the situation.

I guess not so many people also aware of their Corporate Social Responsibility which has helped many in needs. I hope MS and their competitor will keep up their good work --for it will benefit us, the customers.

He's not the most popular guy, sure, but he's done a good job. Just because Microsoft isn't cranking out "the most popular hardware" out there - and they've never really been a hardware company; they're just now coming to grips with that finally, and it hurt 'em severely and will continue to hurt 'em.

I have nothing but respect for the guy, and for Bill Gates, and Paul Allen, and every employee that's ever been with Microsoft. I never had the pleasure but it sure would have been fun back in those "golden years" of computer development in the early 80s to mid 90s.

He's done a good job, he should get a lot more respect than he gets. The chart he put up and discussed is raw proof that Microsoft isn't hurting nearly as much as people have been led to believe (or just chose to believe because of dislike or hate towards Microsoft, whatever).

Congrats, Steve, hope retirement isn't as bad for you as it's been for me...

Microsoft have always done well with Ballmer or whoever.

I judge Microsoft on the products and services they offer and whether I get what I need, not their profit margins which mean nothing to me.

Do I want them to do better with Windows Phone, unify app stores, sure do.

Do I care they made 5 billion, no.

WooHoo!!! said,
Microsoft have always done well with Ballmer or whoever.

I judge Microsoft on the products and services they offer and whether I get what I need, not their profit margins which mean nothing to me.

Do I want them to do better with Windows Phone, unify app stores, sure do.

Do I care they made 5 billion, no.

Well said, me too, however i congratulate them on doing fine.

Reminds me of those cases where a company with a great product goes bankrupt. Irony can go both ways. Lesson is, It's totally different having a good product/service than doing profit out of it.

an organisation isn't purely about profit. Sure they did good profit wise, but that was due to them already having a firm stand in those markets. Look at profitability of new markets MS have ventured into, tablets, smart phones and the story becomes totally different. As a CEO you can't simply be a business man, you need a visionary who can spark ideas for innovation, who knows how to run departments and who knows how to capitalised on ideas that are original. It's been shown over and over MS simply has poor taste.

C#Rocks said,
Thought Google was fairing much better.

Google still makes most if not all of it's money from ads and with the financial crisis still going on lots of people/companies and so on have cut back on ad spending and so on. It was noted that they're ad revenue in search has been on the decline and that's why they're trying to expand it from just being mainly in their websites to on their android devices as well.

Another interesting one is Amazon, the hit they're taking on these cheap kindles isn't helping it seems. I doubt they're making any money on the new line of Kindle Fires and it's showing on the impact to their profits.

GP007 said,

Another interesting one is Amazon, the hit they're taking on these cheap kindles isn't helping it seems. I doubt they're making any money on the new line of Kindle Fires and it's showing on the impact to their profits.

Companies like Google and Amazon are trading on their potential to make, rather than actual profitability.

So what you see is Google and Amazon dumping a lot of products into the market at cost and even below cost to maintain the idea of profitability.

yes I've seen this... trying to gain market share by putting out products for free or at a great loss.... Android, Nexus and Kindle Fires....

Yea, everyone who did their homework knew this already. Unfortunately, as usual on the internet, the clueless 'mob' has won..

MS's board is just obeying the mob, obviously. If you don't understand these types of things, why comment like you do?

He might of been great at his job, but part me thinks he was in charge at right time regarding computers, OS and competition.

It is more complicated now with more devices etc.

I think this is fair. They provided honesty and public information and even admitted that in some cases they weren't the best. Comparing the performance to Apple in particular within the last few years I think it's unfair for people to expect Microsoft to have that type of explosive performance every year, that's just unrealistic.

However I can see why see some investors might be angry since for a lot of the markets that Apple is leading Microsoft research started the market or the idea and pioneered it. For whatever reason, whether an incompetent CEO or just their business practices they didn't aggressively pursue it. However I think you have understand that they weren't in a position where they did have to aggressively pursue it.

The market has changed to a focus more on consumer, which demands faster innovation and better advertising. Microsoft has been in a lot of trouble courting OEM's to deliver quality products and faster innovation. The model of being a software-only company depending on agreements and discussions with hardware companies to deliver every single product does not work well in the fast paced consumer market. OEM's keep their focus on lowering costs and even today they insist in making computer without a touchscreen and with ugly and cheap designs, then blame MS because they don't sell.
To make things worse, OEMs don't see with good eyes the few occasions MS makes their own hardware.
But there is no other way; if you want like Apple, to be able to surprise the media with a full innovative product that will blow your mind, you need to have control of both software and hardware. Come up with the reference design, then let OEM's make their own versions. That's why the Nokia acquisition is a must, and the Surface initiative needs to continue and expand. OEM's may not like it, but at least they can make their own and profit from the innovation and ecosystem; something they could not do if MS forbid its OS to run in third party hardware.

Charles Keledjian said,
The market has changed to a focus more on consumer, which demands faster innovation and better advertising. Microsoft has been in a lot of trouble courting OEM's to deliver quality products and faster innovation. The model of being a software-only company depending on agreements and discussions with hardware companies to deliver every single product does not work well in the fast paced consumer market. OEM's keep their focus on lowering costs and even today they insist in making computer without a touchscreen and with ugly and cheap designs, then blame MS because they don't sell.
To make things worse, OEMs don't see with good eyes the few occasions MS makes their own hardware.
But there is no other way; if you want like Apple, to be able to surprise the media with a full innovative product that will blow your mind, you need to have control of both software and hardware. Come up with the reference design, then let OEM's make their own versions. That's why the Nokia acquisition is a must, and the Surface initiative needs to continue and expand. OEM's may not like it, but at least they can make their own and profit from the innovation and ecosystem; something they could not do if MS forbid its OS to run in third party hardware.

I see what you are saying but I disagree on one part. I feel it is still an enterprise market. Enterprise spending might not be as crazy as it was but it is still the bread and butter of any good tech company. Consumer spending gets more attention and media focus but that does not mean that the market has somehow changed toward the consumer as opposed to the enterprise.

Not with the trend of Bring Your Own Device to work, managers/execs wanting to use iPads/Macs for stuff, etc. While enterprise stuff may be great for power, it's not nearly as "cool" as the consumer stuff in tech. I'm hoping that with Microsoft getting into the consumer stuff (where Microsoft's OEMs have failed to gain much mindshare that they've had), OEMs will focus on making the enterprise stuff (their bread and butter) much more "cooler" and appealing than before.

These numbers can't be right, MS is failing!!!!!!! </s>

btw, always love when people like him pose in front of a solid color like that blue... screams make a blue screen picture out of me

All those numbers show is that Ballmer has driven the company into the ground, which we pretty much already knew.

The 10 year figures are far higher than the 5 year figures and are far higher than the 1 year figures.

He took a huge company/profit and turned it into a smaller company with smaller profits.

I don't think so, the 10 year profit is 220, so 220/10 = 22 billions on average while last 1 year profit is 28 billions which means over the average. Of course if he was charismatic Microsoft should have 50 billions profit last 1 year but 28 is ok too.