The toll of the recession took a heavy toll one of the most famous U.S. companies, Microsoft (MSFT). Microsoft surprised Wall Street by reporting its fiscal second-quarter earnings early and the reports were disheartening. The software giants posted a 11 percent drop in profit and said that as a result they will cut 5,000 jobs in the next 18 months. Microsoft blames the deteriorating global economic conditions and lower revenue from PC software which succumbed them to cut backs. They also followed up by saying that they are unable to provide any profit and revenue forecasts for the upcoming year due to market volatility. Due to Microsoft's news, Tech stocks took a hit except for Apple who reported fiscal first quarter profit which topped analyst projections. On the day, Microsoft's share dropped $2.27, 12% down to $17.11 while Apple gained $5.53, 6.7% to 88.36. Microsoft's biggest problem was the failure of Vista due to compatibility issues with Large corporations. With the release of the new Operating system in November and continued strong revenue from the Xbox 360 i see Microsoft rebounding in 2010, however it will be a struggle in 2009 and i expect lower fiscal earnings reports in the second quarter of 2009. Apple however i believe still has great potential. The main fact that they own such a small amount of market share among computer users shows promise for the future. On the contrary 2009 still will not be a big spending year for many consumers, but Apple's should still be able provide a fiscal annual profit in 2009.
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