Financial comparison of Microsoft, Google and Yahoo! (head one and a half - answers)

So, the previous article caused a certain number of comments. I am very glad that among those who commented are practically all adequate people.

Many thanks to those who expressed their gratitude. It is she, that same gratitude gives me the strength to write further. Well, I would like to respond to certain comments separately.


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EpiChild

When buying a public Internet company, it is necessary to take into account all assets, and not just finance. And the assets on the Internet are, above all, brand awareness and the number of users of the services provided. And the fact that a yahu badly knows how to make money on it is their personal problems. Microsoft does not want to buy Yak because of these 3% revenue.

EpiChild, you are absolutely right. Notice, in the article, I'm not talking about how justified the price that Microsoft offers. I just analyzed the income and expenses of three market players. I will say more, in the second part we will just see how much it would cost to buy Yahoo!

And such things that you are talking about, unfortunately can not be assessed financially, therefore, “brand awareness” and “number of users” are too shaky indicators. For example, what happened recently with Kazaa says that it’s very easy to lose brand awareness, and any joke with a name server can cut out any number of users in the bud.

Apathetic

You draw conclusions from the wrong premises.
Dash mistake is that you consider Microsoft entirely, and followed - only its MSN. I mean, it’s not necessary to compare the financial indicators of the general and the particular.
If we consider the situation from this point of view, the author of the picture is not at all that wrong. Because google and the truth is “more” than MSN and especially yahoo.

Sorry, but there is no company like MSN. There is Microsoft, which made an offer to Yahoo! The fact that one company is also involved in the sale of software does not matter here, because no one ever interfered with Yahoo! do something else besides their services.

enlarge_your_brainis

Gross profit! Ah ha ha ha ha!
Gross income and not profits. There is an income - this is a lope of money. There is an expense - how much dough is gone. There is a profit - income minus expense. If the profit is negative, it is a loss. Or losses.
Well, yes, dude - you're alone in 15 minutes with the help of the Internet, of course, turned out to be smarter than a cloud of microsoftware analysts for a certain period of time :-).

You, of course, just well done. If for you there are such simple categories as income and expense and only - I envy you. And besides, perhaps even a few thousand people are envying, for whom the concept of “gross profit” does exist.

ident

not without journalistic tricks of course, but still a very solid article

You have forgotten about the synergistic effect of the merger: Microsoft successfully works on current / operational costs, having bought Yakh, it can easily get rid of these crazy 83%

and even more, a single company can lower the total share of operating costs below 50%, because you can really get rid of backup staff (sales, etc.)

and Microsoft's financial department estimates the company being bought by revenue, not net profit.

fakeyou

I support. MS doesn’t buy Yahoo because of $ 6bn in revenue, but adds assets, both tangible and non-tangible (this, as I understand it, is the most valuable for MS, i.e. goodwill + software development / certificates / patents and tons .P.). Therefore, do not forget about the possible synergistic effect of the merger. And with the optimization of costs, I think, the MC will somehow figure it out, albeit by the same layoffs, or by getting rid of non-core assets ...

RazB0YniK

I apologize, but the article is completely useless. The author is right saying: "I do not understand at all ..."
It is impossible to generally consider this way! It's like saying: “Take a car without wheels and wheels, none of this can ride. Well, if only the wheels can roll downhill. So we attach the wheels to the car and now we get crap that doesn’t go either, well, God forbid, we will roll downhill as well. ”
I would like to remind about the concept of synergy and the fact that 1 + 1 can equal not 2, but 3.4 or even more. The company's net profit after the merger of the two companies is equal to their sum, only if they operate in completely different, non-overlapping areas and that is not always the case. Thanks to synergy, even 0 + 0 can equal 100! If anyone is interested, I can give you some simple illustrative example.

I agree with you about the synergistic effect, but not entirely. Believe me, back in the 60s, Volvo tried to engage in almost everything. Its managers ran around and talked about an unprecedented synergistic effect and cost diversification, until they finally figured out to sit down and analyze.

The synergistic effect is difficult to assess, it has practically no measurable nature, and therefore for financial analysis it can exist only as a kind of idiom. Will he - is unknown, and put on him - is dangerous.

Of course, that a single company can reduce the share of current costs, I think it will definitely lower it, but the question is - in the name of what? In the name of how many dollars in revenue plus?

And especially for RazB0YniK : if you consider my article completely useless, do not read. I do not force! :)

azazel

The data that the author cited is very informative, and it is clear that the role of the “big fish” should belong to Microsoft, but if you look to the future and introduce a correction factor that would reflect much more Google’s prospects, the fish should be at least the same size. After all, the Internet is becoming more and more widespread, and thus the influence of Google is increasing (after all, the basis of its business is just on intranet solutions), and Google has already encroached on the corporate segment by offering them its online applications as a replacement for Office ... in general, respect the author, we are waiting for her consolidated analysis of perspective

GHM, I'm afraid to disappoint you, but I'm still a man :) But do not worry.

I will tell you that I am very opposed to any prospect correction factors. You will be able to tell about it those who lost enough money during the period of the crash of the dot-coms.

There is an adequate measure of prospects - net profit for the year. I find it most convenient, because it clearly speaks about the quality of work.

Again, I do not want to impose my point of view, it was solely my opinion.

flag_of_labour

I still think that the accusations against Yaha are unfair. The fact that they have a profit / expense ratio is not as impressive as the others, this does not mean that the money is spent on Ferrari for top management. Just managing a company is not as efficient as Google or MS.

And I'm not saying that their money is spent on a Ferrari. I just want to say that the repetition of the same cost distribution for two years in a row speaks not about a one-time “inefficiency”, but about politics in general. Believe me, in the business world there are no coincidences, not the game is now between Yahoo !, shareholders and Microsoft.

hanabi

Dear author.
It is extremely disliked MS and everything connected with it. gatesphobia.
Tested by experience. Although advertisements vindosovyh servak ​​for loot hang.
Do not try to be objective.
Here everyone knows what is good on the Internet and what is bad.
Which browser is the best, and what - shit.
Which vebdvanol is correct and, in general, what is webdvanol.
Who can speak in a free society Habra, and who banned and deleting an article.
Which company is the best, and which is actually none, regardless of real income.
It's clear to everyone that the MC is the biggest player.
As for Google and Yaha, the main activity is for the MS division.
Only some of them are silent, while others try to make sure that others do not talk about it (well, my karma will probably be killed).
It would be better if you praised Google for the growth of income there, for taking care of users and the picture they said that it is just super and drawn wrong in the sense that the Google fish is too small, why AOL is not inside Google.
Here then the price b you were not on Habré

Believe me, hanabi, I write my articles in order to share experiences. I want people not only to read something about Yahoo !, Google and Microsoft, but that they know where the data comes from, how to analyze it and how to be able to separate important and less important things.

And from myself I can say that plus in your karma I will deliver with pleasure.

prostoalex

The author, interestingly, is aware that expenses are the acquisitions of a company? And such high numbers from Yahu are not employees sandwiches, but purchases of Zimbra, Blue Lithium, etc.?

Dear prostoalex! I think you understand that current expenditures include the article “Research,” so the research that is being carried out by Yahoo! through independent research and the purchase of those rights that she may need are reflected there. And the full answer to your question will be in the second part, when we turn to the analysis of assets, and we'll see there - what is interesting about Yahoo!

And in no way can the payments for the purchased rights / enterprises be included in the column “Sales and administration costs”, believe me. There is only marketing, PR and management expenses. Point.

Thanks again to all who expressed their opinions. I will be glad to continue the discussion, but for now - I continue to work on the second chapter.

With love,
maniaque