FBR's Ives Loving Microsoft After Windows 10 Event

Ives attended Microsoft's Windows 10 hardware launch event on Tuesday and noted that it was mainly focused on “new hardware/device launches (e.g., Surface Pro 4, Surface Book, Lumia 950/XL, Band 2) to help propel Microsoft's market/mind share in the consumer segment.”

Augmented Reality

Another important presentation was that of the Hololens, since “this next generation augmented reality product/strategy represents a change from the status quo as Nadella goes after this land grab, multi-billion dollar market opportunity,” Ives explained.

He went on to expound that, in his view, the company and its investors are faced with a new challenge. After writing down the not-so-successful acquisition of Nokia, Nadella is now seeking to gain traction in the highly competitive smartphone arena, where Apple Inc. (NASDAQ: AAPL) and SAMSUNG ELECT LTD(F) (OTC: SSNLF) firmly dominate.

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Consumer Demand

Moreover, he added, Nadella’s underlying goal is to drive further consumer demand and start to change the public’s perception of Microsoft as a "rounding error" in the smartphone and tablet world, taking advantage of the company’s “momentum and unified, cloud-centric Windows 10 architecture.”

“While the new hardware products look impressive, it all comes down to consumer adoption as Microsoft aggressively tries to change its consumer image,” the analyst concluded, noticing, however, that the Windows 10 ecosystem seems to be taking shape – as it has already been installed in over 110 million devices.

Disclosure: Javier Hasse holds no positions in any of the securities mentioned above.

Image Credit: Public Domain