Microsoft Corp.’s board of directors is letting its actions do the talking even as investors raise questions about the strategies chief executive Steve Ballmer is taking.
So far this year, the board has endorsed two of Ballmer’s most ambitious — and expensive — projects: the $8.5 billion acquisition of Internet telephony company Skype and a partnership with mobile phone company Nokia Corp. A person familiar with the board’s thinking said it was “safe to assume the board is backing Steve and the work he is doing.”
Questions over the board’s support for Ballmer bubbled into the market after hedge-fund manager David Einhorn said at an investment conference in New York on Wednesday that the CEO’s “continued presence is the biggest overhang on Microsoft’s stock.” Einhorn said Microsoft was missing opportunities and that Ballmer should be replaced.
Einhorn, whose $5.2 billion Greenlight Capital owns roughly 9 million Microsoft shares, didn’t return calls seeking comment.
Under Ballmer, Microsoft has seen its commanding leads deteriorate in some parts of the software market, like browsers used to navigate the web. The Redmond, Wash.-based company’s major initiatives, including its Bing search engine designed to compete with Google Inc., has captured 15.7 percent of the U.S. search market compared with Google’s 65 percent, and Microsoft’s stock price has stagnated over the past decade.
A Microsoft spokesman declined to comment on Einhorn’s statements, but said the board supported Ballmer’s two biggest projects, the Skype and Nokia deals.
