Silicon Investor (SI) -- The First Internet Community

STOCKTALK

We've detected that you're using an ad content blocking browser plug-in or feature. Ads provide a critical source of revenue to the continued operation of Silicon Investor. We ask that you disable ad blocking while on Silicon Investor in the best interests of our community. If you are not using an ad blocker but are still receiving this message, make sure your browser's tracking protection is set to the 'standard' level.

Technology Stocks : How high will Microsoft fly? -- Ignore unavailable to you. Want to Upgrade?

To: johnd who wrote (22371)	5/8/1999 3:00:00 PM
From: t2	Read Replies (1) \| Respond to of 74651

johnd, The only problem with margins going up is that MSFT sets itself up as a bigger target for government as well as consumer groups. IMHO, a part of the reason for that unearned revenue account was to prevent the gross margins from going higher at a faster rate. They do not appear to have any "prepaid expenses" on the asset side of the balance sheet to match against the unearned revenue liability. The only time the unearned revenue account starts to shrink will be when the company starts experiencing year over year declining revenues. That appears to be several years away---meaning the unearned revenue account should keep going up. It is also possible that MSFT may actually start deferring more revenue by adopting an even more conservative accounting policy to ensure that margins don't go up(or at least not too much higher) Higher and higher gross margins puts the company under more scrunity (charges of operating a monopoly). That is why they will try their best to keep margins in check as they have tried these last couple of years. IMHO of course.

To: johnd who wrote (22371)	5/8/1999 3:04:00 PM
From: Jim Lamb	Read Replies (1) \| Respond to of 74651

Business week mag. cover story this week is "Remaking MSFT". Bill G. and Steve B. on the cover. An excellent read about how MSFT was getting bogged down as many large companies tend to do. It was becoming hard to get things done as to many even small decisions had to go to the top for approval.Balmer has created multiple divisions that now solve their own problems and make their own decisions. Very bullish,made me salivate about the future of the company. These articles used to be free but evidently not anymore with Business week. businessweek.com My thanks to all on the thread for keeping me informed.