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Mobile Devices on Microsoft's Agenda

Microsoft is a company in transition.

The company posted a 19% increase in profits for the third quarter and stressed the future for Windows lies in the shift to new form factor devices and touch-enabled products.

“We are working on suite of small devices powered by Windows,” said Peter Klein, chief financial officer, who also announced he would resign from Microsoft to spend more time with family. Klein noted that Windows 8 touch devices by OEM partners are improving and that more devices at  a variety of price points are expected in the coming months.

Microsoft has laid the groundwork to support new form factor of devices instead of just the traditional PC market. During the call, Klein discussed his expectations for the fourth quarter, noting that Windows will continue to reflect sales from Surface and that he expected OEM licensing to decline for traditional PCs but will grow for the tablet market.

The distribution for Surface has now reached 22 countries and 70 retailers, according to Klein. Reading between the lines, we can all expect Microsoft and its partners to unveil new mini Windows tablets as Klein stressed over and over how Microsoft was investing in Windows 8 devices for different price points.

Products based on Intel’s forthcoming Haswell chip will be realized by September while new form factors using Intel’s Baytrail Atom processor will be in time for the holiday selling season.

Klein also touted Windows and said, “We will release the next version of Windows with Windows Blue.” Windows Blue is expected to be released at Microsoft’s Build developer conference in late June. The company, however, did not discuss the number of Windows 8 licenses sold at this time.

The software giant posted $20.5 billion in revenue, while the Windows Division posted $5.7 billion in revenue, which also included revenue related to its Windows Upgrade Offer. The Microsoft Business Division posted $6.3 billion in revenue, also including its Office Upgrade Offer and product pre-sales. Servers and Tools division posted $5 billion in revenue, Online Services $832 million, Entertainment and Devices division $2.5 billion and the rest was $65 million.

It will be interesting to see if the software giant can become the innovative company it hopes to become. It’s a long-term transition that not only affects the software giant but the entire technology landscape as new mobile devices come to market.

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