Shares of software giant Microsoft (NASDAQ: MSFT) fell on Friday after Chief Executive Steve Ballmer, said analystsâ€™ revenue predictions for Windows Vista were a little overly optimistic.
Microsoft spoke to analysts on Thursday regarding its strategy for fiscal 2008. Steve Ballmer was cautious on expected demand for the companyâ€™s new flagship operating system, Windows Vista, saying people are a little bit over optimistic, or more optimistic than we are about Windows revenue.
Shares of Microsoft dropped 2.27 percent, or $0.66 to 28.80 in mid-day trading on the Nasdaq Stock Market.
Analysts said on Friday that while the comments were not encouraging, the conservative tone was not unexpected.
His views seemed to imply EPS [earnings per share] about inline with Street estimates, wrote Rick Sherlund of Goldman Sachs. We are more optimistic on PC unit growth/Vista demand for 2008 than implied by management guidance, which we view as conservative and setting the bar low for 2008.
Sherlund maintained a Buy rating for the stock, saying valuation of Microsoft shares are among the least expensive in the software sector.
J.P. Morgan analyst Adam Hold also maintained a â€˜Buy,â€™ expecting 9 percent revenue growth in the fiscal year of 2008, for the division that produces Vista.