NEW YORK (TheStreet) -- A lot of people are talking about the turnaround at Microsoft
(MSFT - Get Report). Some believe in it, while others, such as our own Richard Saintvilus, don't.
But whether you believe the change will be profitable, change is underway. Microsoft is becoming a devices-and-cloud company, and is leaving PCs behind. Its latest quarter was boosted by the end of Windows XP, which brought paid support revenue, while next quarter will be hit as the acquisition of Nokia's devices and services business closes Friday.
What few people are discussing, however, is how Microsoft's turn, whatever its merits or results, is leaving other big companies to drown in its wake.
Companies such as Staples
(SPLS - Get Report).
Staples used to be a good business. You may have last heard of it in 2012, when Mitt Romney claimed credit for its success. His Bain Capital
had been an early investor in the company.
While nominally an office supplies superstore, Staples was mainly in the business of selling computer hardware, software and peripherals -- mostly Windows-based hardware, software and peripherals.
Staples was like a passenger on the Microsoft cruise ship. When Microsoft hit an iceberg, Staples went down with it.
Since fiscal 2012, Staples has been shrinking. It hasn't been losing share to rival chains. The company's two main rivals, Office Depot
and OfficeMax, completed their merger in November, but the resulting company's value is falling just as Staples' is.
People no longer go to stores for hardware, software and peripherals. Even printer sales are declining, along with ink sales.
Staples, which had $24.66 billion in sales and $984.6 million in net income, or $1.38 per share, in the year ending Feb. 1, 2012, saw sales of just $23.11 billion and $620.1 million in net income, or $1.14 per share, for all of 2014.
Check Out Our Best Services for Investors
Jim Cramer and Stephanie Link reveal their investment tactics while giving advanced notice before every trade.
- $2.5+ million portfolio
- Large-cap and dividend focus
- Intraday trade alerts from Cramer
Access the tool that DOMINATES the Russell 2000 and the S&P 500.
- Buy, hold, or sell recommendations for over 4,300 stocks
- Unlimited research reports on your favorite stocks
- A custom stock screener
Jim Cramer's protégé, David Peltier, uncovers low dollar stocks with extraordinary upside potential that are flying under Wall Street's radar.
- Model portfolio
- Stocks trading below $10
- Intraday trade alerts