Market Overview

Windows 8 is a Record-Breaking Success

In the 30 days since its release, Microsoft (NASDAQ: MSFT) has sold 40 million licenses of Windows 8.

On the official Windows blog, Microsoft revealed that the new, touch-friendly operating system has outpaced its predecessor, Windows 7, in terms of upgrades.

At the rate Windows 8 is currently selling, Microsoft is moving roughly 1.3 million licenses every day. If that rate is maintained through the new year, the company could easily achieve its estimate of 400 million Windows 8 devices in 2013. That estimate -- which came direct from Microsoft CEO Steve Ballmer -- assumes that there will be 400 million Windows 8 and Windows Phone 8 devices produced next year. Ballmer made no estimate of how many licenses the company would actually sell. But it seems that the company may be able to sell 400 million licenses regardless. And it might not even need the help of Windows Phone 8.

Worldwide PC shipments are expected to reach 367.2 million in 2012. This excludes tablets but includes laptop/tablet hybrids. If fewer PCs are shipped next year (as currently estimated), Windows 8 licenses would still get a massive boost just from the sale of whatever new computers make it to retail.

And because Windows 8 was optimized for touch screens and tablets, it is unlikely to suffer in the wake of declining PC sales. It does not matter if a million consumers buy the Surface Pro or the HP Envy x2 -- either way, another million Windows 8 licenses will be sold.

Thus far, investors have approached Windows 8 with the same attitude as a new Apple (NASDAQ: AAPL) product -- with cautious optimism. From October 25 (the day before Windows 8 was released) to November 6, Microsoft shares rose more than seven percent. The stock has been up more than two percent over the last five days but is still reeling from a three-month decline of more than 11 percent. Year-to-date Microsoft is up more than one percent.

Microsoft has yet to say how many Surface RT units have been sold, but Ballmer recently said that sales are "starting modestly" and that the supply shortages are a "good sign." The company is expected to release Surface Pro, which will run the full version of Windows 8, in January.

This may only be the beginning of Microsoft's manufacturing efforts. Earlier this week DigiTimes reported that Microsoft had commissioned Foxconn to manufacture a new smartphone. Amazon (NASDAQ: AMZN) has reportedly done the same. Instead of enlisting in the help of a partner (as Google (NASDAQ: GOOG) did when producing the Nexus 4), both Microsoft and Amazon are expected to produce their handsets independently.

Microsoft is also rumored to be developing an Xbox-themed tablet. The device, thought by many to be a seven-inch version of Surface, will be dedicated to video games. If the rumors are true, this would be the first time that Microsoft has produced a handheld gaming device.

Follow me @LouisBedigianBZ

Posted-In: Microsoft Steve Ballmer Surface Windows 8 Windows Phone 8News Success Stories Tech Best of Benzinga

 

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