Updated from 9:16 a.m. to include additional analysis about Apple's software revenue in the fifth paragraph.
Since details leaked that Nadella, who took over from Steve Ballmer earlier this year, would announce Microsoft Office will come to Apple's iPad next week, investors have been rewarding Microsoft, crossing $40 for the first time in a long time. That marks a stark contrast from Ballmer, who had been resistant to putting Microsoft's enterprise software and one of its primary revenue drivers, on Apple's tablet.
It's expected that Microsoft will make the announcement, allowing iPad users to use Office with an Office 365 subscription.ake software and services a more important part of its business, due to the notion software and services companies trade at higher earnings multiples than traditional original equipment manufacturers. By taking it's standard 30% cut of all software purchase, Apple could boost its iTunes/Software/Services revenue drastically with Office being made available on the iPad. Last quarter, Apple's iTunes/Software/Services segment generated $4.397 billion in sales, up 19% year over year. Shares of Microsoft were fractionally higher in Friday trading, gaining 0.02% to $40.34, while Apple shares tacked on 0.17% to $529.61.
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