Microsoft may have registered an exceptional financial performance in the recent quarter. But there is one area of its business where it has continued to fail miserably — the smartphone business.
Windows phones have failed to show any competition to iOS and Android devices. Even the flagship Lumia devices continue to disappoint Microsoft and hit a new low in the recent quarter.
According to Microsoft’s own report released along with last quarter’s earnings, it sold a mere 4.5 million Lumia devices in the last quarter — 57% lower than the corresponding period last year when it had sold 10.5 million devices.
According to latest report by International Data Corporation (IDC), there were 399.5 million phones shipped in the fourth quarter of 2015. Samsung, Apple, Huawei, Lenovo, and Xiaomi emerged as the top smartphone vendors in that order during the period.
That means just 1% of the total devices shipped were Lumia devices, making it nothing short of a spectacular failure — given the fact that Microsoft had pitched Windows phones as the alternative smartphone OS against the likes of iOS and Android.
In total, Microsoft and Nokia sold 110 million Windows phones compared to the over 4.5 billion iOS and Android devices. The latest flagship devices of Microsoft, Lumia 950 and Lumia 950 XL failed to make any impact with an unfinished Windows 10 OS. In fact, if you talk about Windows 10 Mobile, the developer roll-out too has been painfully slow, with the PC version getting much faster preview builds as compared to the mobile build.
And even though Microsoft continues to provide Windows 10 updates for its phones, there seems little hope in the future for Windows devices.
Moreover, the initial success of its Surface Book and renewed focus on Surface Pro devices — all coupled with Nadella’s earlier right-off of company’s Nokia buyout, suggest that Microsoft may now be paying more attention to its Surface products rather than smartphones. In fact, the success of Surface Book and Surface Pro 4 recently contributed to the overall Surface revenues (which had dipped in the last quarter) propelling them by 29% to $1.35 billion.
Microsoft knows how Surface brought it success in the hardware arena, and hence there is a rumored upcoming Surface phone expected to be launched this year.