Microsoft's weak stock due to lack of mobile presence?

Is the software giant's sluggish stock showing due to its conspicuous absence in mobile market?

Microsoft has been slow to jump into the mobile game, and according to some, it's costing them.

In spite of sales in the project $20.9 billion range, showing a 5% increase since last year, Microsoft stock has performed sluggishly becuase of an unwillingness to properly commit to expanding their mobile properties, according to one report. The company has a net profit of only $0.76 per share, a decline from last year's $0.76. 

Microsoft has indicated that slow PC sales in 2011 -- a 1.4% decline in growth of PC sales in Q4, according to information and technology research firm, Gartner -- as well as flooding in Thailand, which has affected the production of Microsoft disk-drives, has figured for less than stellar numbers. Gartner predicts that disk-drive production will be slow to recover in 2012, and may take the first half of the year.

Gartner also indicated that "continuously low PC demand" from consumers may flag the growth of Microsoft's stock even after disk drive production is back to 100%. The company's software production is vitally important to its health, even in consideration of its domination of the gaming industry.

Microsoft stock has fluctuated between $23 and $29 since May 2010, which was the last time company stock was over $30.

Microsoft stockholders should be encouraged by the company's upcoming release of the Nokia Lumia 900 smart phone, as well as Windows 8. A prototype for the Lumia 900 was debuted recently at CES in Las Vegas, and Wired magazine listed it among its "12 Best" gadgets at the convention. However, no release date was set for the smart phone.

The other bright spot in Microsoft's future, the release of the mobile-ready Windows 8, has likewise not been definitively scheduled. The comany has indicated the software would release in Beta in February, which would mean a full release closer to early 2013.

Microsoft has been in the mobile game for a long time, but whether it will change its platform to reflect the industry standards set by Apple and Android remains to be seen. In 2007, Microsoft held 47% of the mobile market share. By 2011, that figure had shrunk to only 3%. And if Windows 8 platform for tablets launches in early 2013, as some are projecting, Apple will have a nearly three years' head start on them in the race for tablet supremacy.

Make no mistake, all signs point to mobile superceding PCs in the coming years, and even giants like Microsoft will have to toe the line. It's not just that new generations of smart phones are making record-breaking sales, or that apps are being downloaded faster than ever. Studies of e-commerce and online advertising also show that people are gradually, but steadily, making the switch from PCs to mobile devices.

Microsoft was at the forfront of the digital revolution, but whether they remain on top, as the tech world heads into the "post-PC era" heralded by Steve Jobs, remains to be seen.

[Image Credit: BGR]