Microsoft’s wild ride
Satya Nadella took over the reigns at Microsoft in 2014 at a perilous time and has done an exceptional job, equal to – and perhaps even surpassing – Tim Cook at Apple.
Since then, Microsoft’s stock has risen from around $36 to $315, where it sits today, having gained 51% in 2021 alone, outpacing the S&P 500’s 27% rise.
To achieve this turnaround, Nadella refocused Microsoft on rethinking how Office and Windows fit into its overall services business; gone were the one-time payments, replaced with recurring monthly (or yearly) fees to access Windows and Office 365.
On top of this, Nadella invested heavily in building out Azure and other enterprise-focused offerings to compete with Amazon’s AWS and Google Cloud. By some estimates, Azure hold 20% of the cloud market, below AWS’ 32% and above Google’s 9%.
Would spinning off Windows and Office work?
According to analysts that CNBC spoke to, spinning off Windows and Office would make very little sense. Nadella has built significant and much-needed synergies between Microsoft’s various businesses, in such a way that the rise of one boosts the others.
Removing two of Microsoft’s most longstanding and important products from the mix would likely have a negative impact on Azure and other services, which can be bundled together and sold to companies.