Microsoft CEO Steve Ballmer must feel like a worn-out punching bag after the week he’s experienced.
Ballmer’s bad week started when David Einhorn, the founder of the Greenlight Capital hedge fund, called for new leadership at Microsoft. Einhorn’s hedge fund owns approximately 9 million shares of Microsoft, around 0.11 percent of the company.
“Ballmer is stick in the past and is, at best, a caretaker at Microsoft,” Einhorn told the audience at the Ira Sohn Conference.
It didn’t take long for the media to pile the blame on Microsoft’s beleaguered CEO. This is certainly not the first time that people have called for Steve Ballmer’s head, but the chorus of critics has certainly gotten loud er.
Are the critics right? Should Ballmer get the boot? Does Microsoft need a fresh, new face (or a familiar one) to guide it into a post-PC world?
Let’s crunch the numbers.
Grading Ballmer’s Performance
Steve Ballmer’s tenure at Microsoft is a tale of two conflicting graphs. Which one is more important depends on whether you care more about the bottom line or the company’s stock price.
The first graph depicts Microsoft’s revenue from 2000, when Ballmer took over as CEO, to 2010:
A business lives and dies by its cash flow and revenue, and by that metric, Ballmer has done a good job guiding Microsoft towards steady growth. In 2000, Microsoft earned $23 billion in revenue and $9.4 billion in net income. In 2004, Microsoft garnered $36.8 billion in revenue and $8.2 billion in net income.
In 2010, those numbers jumped to $62.48 billion in revenue and $18.7 billion in net income. Revenue near ly tripled and income...
