Microsoft held its annual shareholder meeting Dec. 3 and the event was notable as much for who wasn't on stage as who was.
The annual meeting was a first for CEO Satya Nadella and Chairman John Thompson, who led the proceedings, while former CEO Steve Ballmer, who stepped down from the company's board of directors but remains its largest shareholder, watched from the audience. Company founder, board member, and former CEO Bill Gates was not there at all, making the changing of the guard even morenotable.
Continue Reading Below
This was Nadella and Thompson's show and both wanted to make it clear that Microsoft going forward may not be the same company it was in the past. That's not meant to be an indictment of past management, merely an acknowledgement that things have, and will continue to evolve.
"This past year has been one of tremendous change for Microsoft," Thompson said in his opening remarks. "As Bill Gates said at our last year's annual meeting, Microsoft is in a highly competitive and dynamic industry and many opportunities and challenges are ahead of us."
The chairman alsoacknowledged that the company is in the middle of "the most strategic transformation we have ever had," which in addition to the executive changes, includes areinvigorationof its strategic focus and amajorrealignment of its cost structure and workforce. This has included laying off approximately 18,000 employees, reducing its reliance on contingent or contract workers by at least 20%, and reorganizing its executive team and business groups.
Nadella has also made some smaller moves, such as ending the money-losing production of original content for the company's various web platforms and more or less shuttering the much-hyped original video division which had been launched with along with Xbox One in 2013 to create television-style shows for the console. Most importantly, Nadella has signaled that the free-spending days were over and the company was going to invest heavily but in a more focused way than it had in the past.
Microsoft CEO Satya Nadella addresses the company's annual shareholder's meeting. Source: Screenshot
The company thinks of itself this wayThompson described Microsoft as "a productivity and platforms company for the mobile first and cloud first world." What that means is the company will leverage its brands including Windows, Office, and Azure to expand its reach. Thompson also made it clear that the new structure of the company provides for expense control -- something which has not always been a Microsoft strong suit.
Nadella also restated the company's commitment to the vision laid out above when he spoke.
"Our goal is to thrive in a mobile first, cloud first world by excelling in productivity and platforms," the CEO said while laying out his vision for the future where he believes his company will take a lead role in making computing "more personal and natural" through a variety of technologies.
Already under Nadella the company has gotten aggressively behind Surface Pro 3, a touchscreen tablet/laptop hybrid which makes use of the cloud and embodies the idea of a device which is personal and natural to use. Microsoft has also strengthened its commitment to its Azure cloud platform, and expanded its line of Windows Phones. The biggest change however is the one yet to come, the new versions of Windows, dubbed Windows 10, which will enhance user experience by allowing the same OS to be used across Microsoft's PCs, tablets, and phones.
Bill Gates still mattersWhile his absence from the meeting was notable, Gates likely stayed away in order keep the focus on the new leadership team. Thompson mentioned him repeatedly and highlighted his expanded day-to-day role.
"Bill Gates has taken on the role of technology advisor, helping to shape the technology and product direction of the company," he said.
Gates has never been one for the spotlight, but Thompson went out of his way to make it clear that while he was no longer chairman of the board, he was still actively involved. It may not have been intended as a slight, but he also pointed out that Ballmer is no longer on the board nor does he have a role beyond being the company's largest shareholder.
Office everywhere, but best on Windows?"We want to make sure that Office 365 is available to everyone on every device and that's what we've committed to, and in fact, it's driving some good adoption and usage," Nadella said in response to a question.
But while committing to having Office on every platform -- a Nadella initiative -- the CEO also acknowledged that Microsoft would continue to develop technology that takes optimal advantage of the company's native Windows environment.
"I think of Windows as the coming together of the best of Microsoft, in the most natural way," he said "But that doesn't mean we are not going to also have great applications for people to use. I want to have a Microsoft folder on every device, and Microsoft Windows on more devices. That's how I think our strategy going forward will shape up."
The article 3 Things Microsoft Wants Its Shareholders to Know originally appeared on Fool.com.
Daniel Kline owns shares of Microsoft. The Motley Fool owns shares of Microsoft. Try any of our Foolish newsletter services free for 30 days. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy.
Copyright 1995 - 2014 The Motley Fool, LLC. All rights reserved. The Motley Fool has a disclosure policy.