Microsoft CEO Satya Nadella: Celebrating $1 trillion market cap would be ‘the beginning of the end’

Microsoft CEO Satya Nadella: Celebrating $1 trillion market cap would be ‘the beginning of the end’

1:12pm, 2nd May, 2019
Microsoft CEO Satya Nadella. (GeekWire Photo / Kevin Lisota) Under Satya Nadella, Microsoft has returned to the tech elite, punctuated by the company hitting a financial milestone of a for the first time. However, Nadella isn’t reveling in the news; in fact he would be “disgusted if somebody ever celebrated our market cap.” Those comments come from a about how Microsoft has rebounded under Nadella from a nadir point marked by failures of key initiatives and cultural issues. Nadella has transitioned the company away from some of its legacy businesses to focus primarily on cloud computing and its boring, but profitable mission of helping companies work more efficiently. Microsoft’s cloud division sits squarely in the number two position, trailing incumbent leader Amazon Web Services. Microsoft has become a landing spot for retailers such as Kroger and Walmart who don’t want to store their data on Amazon’s servers while also competing with the tech giant. The effort has put Microsoft on strong financial footing. Its stock has climbed 35 percent in the last year, and it currently holds the title of the nation’s most-valuable company, beating out tech giants Amazon and Apple. However, Nadella told Bloomberg that the market cap milestones are “not meaningful” and any celebration of it would mark “the beginning of the end.” Here are a few other interesting tidbits from the interview with Nadella: De-emphasizing Windows: It started subtly, as one former executive put it, with Nadella simply omitting “Windows” from sentences. And his first email to employees as CEO ran more than 1,000 words without a single mention of Windows. Windows continues to be the product most synonymous with Microsoft, and is on more than . But last year, in a , Microsoft blew up its Windows division, splitting it across the Azure and Office teams, a sign of the company’s priorities for the future. Microsoft returns to its uncool roots: Bloomberg notes that under previous CEO Steve Ballmer “Microsoft was chasing a sexy, Apple-like version of itself, and mostly failing. For every iPod, there was a Zune; for every iPad, a Surface tablet; for every iOS device, a Windows Phone.” Nadella famously wrote off Microsoft’s smartphone division and wound down the Windows Phone operating system. Instead, the mobile focus has shifted to building apps and services that work well on both Android and iOS. There’s been a lot of talk about Microsoft being cool again, but that’s not what the company aims for. As the company’s CTO last year: “Our job is to make other people cool .We don’t need to be cool ourselves.” Culture changes, but issues persist: Re-shaping company culture has become an important part of Nadella’s tenure, with a goal of wiping out the infighting that has been a hallmark of the company’s past. All signs indicate that this effort has been largely successful and played a role in turning the company around. However, in recent months, it’s become clear that Microsoft still has a ways to go. A group of female employees recently described experiences of sexual harassment and discrimination at the company in Last month, Nadella meant to rectify issues described by the employees.
Microsoft briefly becomes a $1 trillion company following strong earnings report

Microsoft briefly becomes a $1 trillion company following strong earnings report

6:02pm, 24th April, 2019
Microsoft CEO Satya Nadella at the company’s 2018 Shareholder Meeting. (GeekWire Photo / Nat Levy) Microsoft’s strong performance in the most recent quarter pushed the tech giant into rarefied air: The trillion-dollar market capitalization club. Microsoft is tangling with fellow tech giants Amazon and Apple for the title of the nation’s most-valuable and surged into the lead when it reported its quarterly financials Wednesday. Microsoft’s stock rose as much as 4.5 percent in after-hours trading, pushing the company’s market cap over the $1 trillion mark. Later in the afternoon, Microsoft’s value fell just below that landmark level. Amazon and Apple have both been there before and have a chance to again hit $1 trillion in market cap when they report their quarterly financials in the coming days. Amazon is set to report tomorrow, and Apple is coming up on Monday. The fluctuations between a $998 billion company and a $1 trillion company don’t mean much in the long run, but the market cap milestone is another financial feather in the cap of Microsoft and the years-long turnaround under CEO Satya Nadella. Microsoft has reimagined itself as a cloud-powered company that seeks to bring its services to as many users as possible, even if that means partnering with competitors. Powering the rise in market cap is Microsoft’s surging stock. It has shot up 34 percent so far this year. Microsoft executives got their quarterly kudos for the strong results on a call with investors Wednesday. But don’t expect the leaders to throw a big celebration for the company hitting a $1 trillion market cap. “This is a metric that nobody on the senior leadership team is tracking,” Microsoft Chief Marketing Officer Chris Capossela of the company’s market cap and how it compares to others. He continued: “Nobody is sitting around high-fiving when the stock hits some new high,” Capossela said. “We are like ‘wow, the bar just went up dramatically.’ So it’s a very humble tone; there’s not a lot of, ‘woo, we’re killing it.’”