EditorsAbout the SiteComes vs. MicrosoftUsing This Web SiteSite ArchivesCredibility IndexOOXMLOpenDocumentPatentsNovellNews DigestSite NewsRSS

04.25.10

Microsoft Cumulative Debt Almost Doubles to About $80 Billion in Just a Few Years (Updated)

Posted in Finance, Microsoft, Novell at 7:15 am by Dr. Roy Schestowitz

[Update: A reader points out that “the graph is of cumulative debt. Which equates with MSFT having around $6Bn debt from being debt free in Q2 2008.”]

Bernard Madoff
Microsoft’s debt exceeds even Madoff’s

Summary: Microsoft’s debt — like Novell’s debt — is a scarcely-explored subject in the media, but we’ve finally found the latest figures

OUR WIKI now contains this page about Microsoft’s financial situation. It is not what many people imagine it to be and last year we pointed out that Microsoft has debt. Yes, it’s true. We just couldn’t quite tell at the time how big the debt was, but now we have a clue. Here is some background reading:

Business Insider shows data from a reliable source, indicating that Microsoft’s debt is going through the roof (increasing faster than Microsoft can keep up with). Read the numbers. While Google and Apple have no debt, Microsoft has a huge debt approaching a tenth of a trillion dollars. Microsoft relies on shareholders to put their money in this pit.

Tech companies, which generally throw off tons of cash, added a healthy sum of debt to their balance sheets last year, the Wall Street Journal notes.

We are increasingly welcoming a world where companies with a sort of overdraft claim to be “cash rich”. It’s the same world where a country with 14+ trillion dollars in debt pretends the problem will just go away and asks Microsoft to create computer games to mitigate perception issues [1, 2].

“While Google and Apple have no debt, Microsoft has a huge debt approaching a tenth of a trillion dollars.”Microsoft’s debt is not so unusual, but it is far greater than the rest. Novell’s own debt is an issue we explored last year.

Many of Microsoft’s business units make no money. They just lose a lot of money, but people continue to think about Windows and Office, which are the exception, not the norm. These are cash cows whose revenue is actually declining (Office revenue is still going down). We mentioned this some days ago when we cited Joseph Tartakoff, but as Tartakoff later points out (regarding the same article of his that he tweeted about 4 times): “Microsoft’s online losses up to a staggering $713 million, from $411 million a year ago” (this is not surprising at all).

That’s the loss in just one quarter and one business unit! It used to be over $2 billion in losses per year, now it’s around $3 billion in losses per year, assuming this new pace of losses carries on.

More information about Microsoft’s real financial performance is coming soon. We are going through reports and interpreting them. It doesn’t look too good.

Microsoft keeps taking on debt, whereas some of its biggest competitors remain debt free. Terry Porter writes: “It’s interesting that Google and Apple both deploy Unix and are debt free, so perhaps using Unix must be good for business?”

“Microsoft, the world’s most valuable company, declared a profit of $4.5 billion in 1998; when the cost of options awarded that year, plus the change in the value of outstanding options, is deducted, the firm made a loss of $18 billion, according to Smithers.”

The Economist, 1999

Share this post: These icons link to social bookmarking sites where readers can share and discover new web pages.
  • Digg
  • del.icio.us
  • Reddit
  • co.mments
  • DZone
  • email
  • Google Bookmarks
  • LinkedIn
  • NewsVine
  • Print
  • Technorati
  • TwitThis
  • Facebook

If you liked this post, consider subscribing to the RSS feed or join us now at the IRC channels.

Pages that cross-reference this one

3 Comments

  1. uberVU - social comments said,

    April 25, 2010 at 7:33 am

    Social comments and analytics for this post…

    This post was mentioned on Identica by schestowitz: #Microsoft Debt Almost Doubles to About $80 Billion in Just a Few Years http://ur1.ca/wzal #fraud #deficit #sec…

  2. Tom Womack said,

    April 25, 2010 at 7:47 am

    Gravatar

    I think you’re misreading the graph at Business Week; Microsoft’s chunk is the red bit between about 71 and about 75 billion, they have $3.75 billion of bonds outstanding, as part of $22 billion in debt (http://www.microsoft.com/msft/reports/ar09/10k_fr_not_03.html)

    Which isn’t unreasonable since they have $36 billion in investments, including $13 billion in Treasury bonds.

    your_friend Reply:

    Turning a $60 billion cash pile into questionable “investments” said to be worth $36 billion while taking on a real $22 billion in debt is reasonable? To who? The deeper into debt Microsoft falls, the harder it will be for them to conceal their failure.

    Non free softare has never been a sustainable business model. This is why Microsoft has invaded media and the web. It’s not working out for them for the same reasons their software business is not. Everything Microsoft buys, it wrecks trying to feed Windows. Customers don’t like it and Windows itself is a basket case. The apparent success of Windows and Microsoft in the 90s is really the story of many other non free software company failures.

What Else is New


  1. IRC Proceedings: May 17th - May 30th, 2015

    Many IRC logs



  2. Sharp Drop in Microsoft Patents, But Not in Patent Assaults, Coordinated Attacks on Android/Linux, and Googlebombing

    Using patent blackmail (antithetical to the original goal of patents) and other forms of blackmail, Microsoft is desperately trying to crush GNU/Linux and Android, all while Windows 'sales' fall and investors lose confidence



  3. EPO Reluctantly (and Privately) Confirms Giving Public Money for Military-connected 'Control Risks' to Spy on Journalists and Their Sources While Techrights is Under Fresh DDOS Attacks

    The EPO President -- or anyone who is referred to as 'appointing authority' -- finds himself even deeper in a scandal as he silently attacks the very same people whom he pretends to negotiate with by contracting spies from London (to maliciously target British journalists)



  4. Links 1/6/2015: wattOS R9, Tanglu 3

    Links for the day



  5. Supreme Failure: With SCOTUS Approval of Patent Trolls and a Push by Justice Department to Reinforce Copyright on APIs (at SCOTUS Level) the Future Looks Gloomy

    The patent system goes wild in terms of scope, the nature of the plaintiff (merely purchasing patents), and the extension of patents to monopolies on named APIs (by virtue of deranged interpretation of copyright law)



  6. McAfee Associates Free Software and Anonymity With Crime

    Insecurity firm McAfee, whose record on Free software is appalling (it is Windows-centric for its business), continues years of tradition by slinging mud at Tor



  7. The EPO Still Wastes Public Money on Publicity Stunts and 'Reputation Management' Campaigns

    The European Patent Office (EPO) is misusing public funds to manufacture self-congratulatory publicity for itself whilst attacking those who write negative commentary



  8. The Lessons of Stuxnet: Never Use Microsoft Windows

    Windows is sufficiently 'NSA-compatible' for remote compromise and physical damage (sabotage) to highly sensitive, high-risk equipment



  9. Links 30/5/2015: Wine 1.7.44, Berry Linux 1.20

    Links for the day



  10. White House Intervention Harms Android and Every Software Developer on the Planet

    US Solicitor General Donald Verrilli urges the Supreme Court (SCOTUS) to let APIs be covered by copyrights, rendering almost every program a potential copyright violation



  11. Microsoft Lobbying in India Shoots Down or At Least Weakens Free/Libre Software Policy

    Microsoft's covert efforts (lobbying with the help of public partners like NASSCOM) to eliminate an India-leaning software policy in India is finally paying off



  12. Propaganda Mode for UPC Agreement Whilst EPO Increasingly Grants Patents on Software

    In order to make the Unitary Patent a reality (towards a 'no place to hide' patent approach) misleading claims are being made



  13. Patents Are Not Source Code

    Ford is once again misleading regarding Open Source, mischievously associating a patent pledge with Open Source



  14. Links 29/5/2015: ALT Linux 7.0.5, Google I/O 2015

    Links for the day



  15. Links 28/5/2015: SourceForge Hijack, RIP Marco Pesenti Gritti

    Links for the day



  16. Censorship on Reddit Has Gotten (Condé) Nasty and Silent, Even Actively Silenced

    Condé Nast has turned Reddit into a platform of censorship after the acquisition



  17. The Supreme Court of the United States Helps Patent Trolls

    In an unforeseen kind of ruling, the same court which slapped down a lot of software patents last year is now legitimising the actions of a patent troll



  18. Patent Lawyers Fight Hard for the Future of Software Patents

    Media that is dominated by patent lawyers and targets an audience of patent lawyers refuses to accept the post-Alice reality



  19. Fortune Glorifies Patent Troll Jay Walker (Patent Utility)

    Jay Walker, a patent troll, creates a Web-based trolling/'licensing' service and the corporate media helps him



  20. Stealing Android's Thunder, Making It All About Apple and Microsoft During Google I/O

    Misleading articles and conjoined media/analyst attacks on Android coincide with Google's event where major Android announcements are being made



  21. British Government May be a Step Closer to GNU/Linux (on the Desktops, Not Just Servers)

    The British government stops paying the criminal company that blackmails its members, thereby increasing the possibility of complete escape from proprietary software



  22. Microsoft's Patent Allies LG and Sony Agree to Put Microsoft Inside Android

    LG and Sony (of Rockstar Consortium) follow Samsung and Dell in Microsoft's campaign to turn Android into 'Microsoft Android' using patents-induced pressure/leverage



  23. Yet Another Major Security Deficiency in UEFI

    UEFI is inherently insecure, more so than the alternatives which it strives to replace, including Free/libre ones



  24. Links 27/5/2015: Fedora 22 is Out, Mandriva Liquidated

    Links for the day



  25. Patent Scope at the EPO is Totally Out of Control, UPC Will Make Things Worse

    A look at the practical issues with the EPO, where patent scope and litigation scope have been vastly extended so as to benefit multinational corporations and possibly patent trolls



  26. Links 26/5/2015: Reviews of Kubuntu 15.04, Linux 4.1 RC5

    Links for the day



  27. Süddeutsche Zeitung Says Talking Helps While EPO Management Back-stabs Other Side of the Table

    German media gives the impression that there is peace and harmony now that Benoît Battistelli and his circle of power speaks to staff, but nothing is said about simultaneous (albeit covert) attacks against that staff



  28. Large Corporations Call the Shots in US Patent Reform

    A reminder of where we stand on the issue of patent 'reform' in the US and who is controlling or shaping it



  29. Microsoft Puts Proprietary Windows and Hyper-V Inside the Free Software-Centric OpenStack

    OpenStack, which celebrates rapid growth in this month's event in Canada, is facing a proprietarisation threat from Microsoft



  30. Microsoft's Secret Lobbying, Bullying, and the Long History of Blackmailing Politicians Around the World

    British media covers Microsoft's abuse in the UK, but there are many similar incidents, and not just in the UK


CoPilotCo

RSS 64x64RSS Feed: subscribe to the RSS feed for regular updates

Home iconSite Wiki: You can improve this site by helping the extension of the site's content

Home iconSite Home: Background about the site and some key features in the front page

Chat iconIRC Channel: Come and chat with us in real time

CoPilotCo

Recent Posts