Microsoft’s shares took a beating at Wall Street after the company announced a drop in the sales of its Windows operating system.
Owing to weak consumer demand for desktops and laptops, Microsoft reported a fall in the sale of its Windows operating system which caused investors to become jittery, resulting in a drop of as much as 5 percent in Microsoft’s share price.
On Friday, the company’s share price closed down 3 percent at $25.92 on Nasdaq. During the day, the share price dropped by almost 5 percent at $25.36.
“Even though they had good earnings, the PC market is under scrutiny and there continues to be uncertainty on whether or not Microsoft can compete with the growing tablet and handheld devices from the likes of Samsung and Motorola,” UBS analyst Brent Thill said in a statement, after he cut Microsoft’s trading price target to $32 from $35.
Microsoft, which is the second most valuable US technology company after Apple, surpassed analysts’ estimates when it released its third quarter results. The company reported a 60 percent year-on-year rise in its revenue from its entertainment division which includes Xbox 360 and Kinect.
The company’s market valuation is at $225 billion behind Apple’s $321 billion evaluation. Intel is third with $207 billion.