Sinofsky's departure hits Microsoft's share price

News 13 Nov, 2012

Meanwhile, industry watchers dismiss notion that Windows chief's departure is linked to early sales performance of new operating system.

The departure of Windows chief Steven Sinofsky has caused Microsoft’s share price to fall, as speculation about his reasons for leaving continue to rage.

As reported by IT Pro earlier today, Sinofsky has left the firm after 23 years, a move that has taken many in the IT industry by surprise, given Microsoft released the latest version of its Windows operating system less than three weeks ago.

No official explanation has been offered by Microsoft to explain his departure, although it is understood to have been mutually agreed.

What’s more likely is he’s becoming the CEO of a competitor.

The news has resulted in $10 billion being wiped off the software giant’s market cap, as its stock price slipped by four per cent in early trading to less than $27 a share.

A Microsoft insider, who agreed to speak to IT Pro under condition of anonymity, dismissed the notion that the initial sales success of Windows 8 may have been a factor in his decision to leave.

“It is too early for Windows 8 to have caused this,” said our source. “What’s more likely is he’s becoming the CEO of a competitor – although non-compete contract clauses would make that difficult – or he’s angered the powers that be at Microsoft.”

Meanwhile, in a report with French daily newspaper, Le Parisien, Microsoft CEO Steve Ballmer revealed that four million Windows 8 upgrades were sold during its first three days on sale.

According to figures released by analyst house Context earlier today, the new OS has got off to a good start in Europe and sales are on a par with Windows 7’s pre-launch performance.

In the week leading up to the launch of Windows 8, 23.5 per cent of the PCs sold through IT distributors featured the new OS. This figure increased to 41.3 per cent the following week.

By contrast, pre-launch week sales of Windows 7 through distribution peaked at 17.1 per cent back in October 2009, rising to 43.8 per cent when the OS went on general release the week after.

Jeremy Davies, chief executive of Context, said concerns about how the decline in PC sales would affect Windows 8’s performance have so far proven unfounded.

“There were fears the decline in PC sales had resulted in excess inventory, which could have damped sales of new machines considerably, but it...has not unduly affected the launch,” said Davies.

“Despite the uncertain economy, PC sales through IT distribution in the two weeks prior to launch, and including launch week itself, actually rose 7.8 per cent compared to the same period one year ago.”