Apple demolished by Microsoft at their respective PC events

Apple demolished by Microsoft at their respective PC events
Published: Oct 29, 2016 3:50 p.m. ET

Microsoft hailed as the winner over Apple following back-to-back events


Who would have thought that at back-to-back hardware events in the year 2016, Microsoft Corp.’s would prove the much more innovative and exciting one over Apple Inc.? Times are a-changing.

On Wednesday, Microsoft unveiled the Windows 10 Creators Update that includes 3D imaging tools; new virtual-reality headsets that can be used through a HoloLens platform on Windows PCs; live broadcasting for Xbox; a $2,999 enterprise-grade desktop called Surface Studio that essentially folds into a table-sized tablet; the Surface Dial, which is an input device for Surface products that lets users toggle between different menu items by twisting it like a doorknob; and the Surface Book i7.

Also Read: Microsoft’s new Surface Studio aims to compete with Apple’s iMac

On Thursday, Apple unveiled a new app for Apple TV that essentially is a glorified TV guide without the world’s two most popular streaming services on it — Inc.’s Prime Video and Netflix Inc. — two new MacBook Pros that are marginally thinner and lighter than their predecessors, and a new input feature called Touch Bar that, similar to Surface Dial, lets users more easily interact with their screens from the top of their PCs and can adapt input options based on the software being used at the time.

While PiperJaffray analyst Gene Munster called Apple’s Mac updates “a solid evolution” to its Pro line of laptops, many other people argued it was hugely underwhelming when compared to Microsoft’s the day prior. That is an issue for Apple as it forecasts returning to sales growth this quarter after three straight quarters of declines.

On Tuesday, Apple reported its first annual revenue decline in 15 years on the back of another week quarter. Fourth-quarter sales were down 9% year-over-year, weighed down by a 13% decline for the iPhone and a 17% decline for the Mac. The one bright spot was services, such as Apple Pay and Apple Care, which rose 24%. Sales from services surpassed $6 billion during the quarter, while revenue from the Mac declined to $4.9 billion.

However, many analysts were hoping holiday sales for the Mac would help the company return to growth in the current fiscal quarter. Apple’s fiscal first-quarter revenue guidance between $76 billion and $78 billion brackets the Wall Street consensus of $77.4 billion, according to FactSet. The company’s Mac line has faced increased competition from the likes of Microsoft and Alphabet Inc.  in recent years, particularly amid the rise of sophisticated two-in-one tablets, such as the Surface Book. The Mac performed poorly during back-to-school shopping compared with Google’s Chromebook Pixel. Thursday’s event likely did little to fuel optimism.

Shares of Apple fell more than 1% to $114.35 shortly after the event ended Thursday afternoon. Its shares have outperformed in the past three months, rising 11% versus a 1.7% decline for the Dow Jones Industrial Average and a 1.5% decline for the S&P 500. However, they’ve underperformed on the year, declining 0.2% in the past 12 months, compared with more than 3% increases for both the Dow 30 and S&P.

Many designers on Twitter were quick to call the product suite announced at Microsoft’s event much better and more exciting than Apple’s.


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