Many Microsoft "Assets" Are Fabricated Baloney (to Game the Numbers)
Microsoft has laid off over 50,000 workers (by our count) in the past couple of years alone*. The "official" numbers are a fraud. A lot of sloppy media just parrots whatever Microsoft says and whatever Microsoft did not formally disclose is wrongly assumed to never have happened. "Voluntary" layoffs have just been mentioned along with "RTO, relocation, PIP etc."
One reader has asked regarding Microsoft: "1) Approx how many rounds of layoffs have there been in 2 years? 20? 2) Approx how many people have been laid off in those 2 years? 10s of thousands?"
There's the risk of metastasization when they leave, but that can be dealt with separately. Metastases by Microsoft are a topic we covered here many times before.
Given all those layoffs, one should expect the value of the company to go down, not up. Something very irrational has been happening.
Also revisit the following theme: Symptom or Hallmark of Ponzi Schemes: Microsoft Says It Gains Over 100 Million Dollars in "Goodwill" and Its Speculative "Value" Nearly Doubled to $119,329,000,000 in the Past Year Alone | Microsoft: Our "Goodwill" Gained Over 51 Billion Dollars in the Past Nine Months Alone, Now "Worth" as Much as All Our Physical Assets (Property and Equipment) | Microsoft Claims "Goodwill" Is an Asset Valued at $119,163,000,000, Cash Decreased From $34,704,000,000 to $19,634,000,000 and Total Liabilities Grew to $231,123,000,000
"Goodwill"... we know what that means literally, but what does that mean in terms of accounting? Well, knowing that the Federal Circuit is quashing many software patents, as does the Patent Trial and Appeal Board (PTAB) via inter partes reviews (IPRs), typically citing Alice (SCOTUS)/35 U.S.C. § 101, it does not matter how many such patents the U.S. Patent and Trademark Office (USPTO) grants, nor does it matter how many European software patents Microsoft has. Those are barely enforceable anymore (too much uncertainty/risk), even if the EPO clearly violates** the original European Patent Convention (EPC, 1973) and many in the US would simply settle without trial because trials are expensive. Without a doubt most software patents lost a lot in "value" about a decade ago.
One reader told us "that the "Goodwill" in Microsoft's accounting ledger probably refers mostly to software patents. It's a bubble which has been popped by Alice etc."
That information is based on somebody "who used to deal with accounting and investments," not some random person. He "asserts that "goodwill" includes "assets" like patents. He did that kind of investment rather (but not entirely) successfully for many decades, since the early 1970s."
"If true," the reader adds, "then that bubble was popped by Alice."
So how much of Microsoft's "goodwill" is nil? Why did it not diminish but instead only doubled in a short period of time? On what basis?
"Also," noted the reader, "if the "goodwill" covers experience, then the layoffs have effect on that too."
For sure. With Microsoft, nothing makes much sense. At times it seems like what we deal with are many weak patents (on algorithms), valuations or speculations based on hype ("hey hi"), and stocks held by Microsoft and its own staff (which gets salaries and bonuses in "stock", i.e. made to participate in the artificial inflation). █
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* Some layoffs were part of complete shutdowns of entire units, e.g. in China, so there is an overlapping thing to keep track of and properly count.
** In fact, the EPO is not a reliable steward of the European Patent Convention text, we're told. "The EC does not have a safe, unmodified copy and ignored subsequent messages about it. So the EPO could be gradually tweaking the contents over time."