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Microsoft Offers Who's In App on Apple's iMessage App Store

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Reportedly, Microsoft Corporation (MSFT - Free Report) recently launched a social event planning app called Who’s In exclusively on Apple’s (AAPL - Free Report) iMessage App Store.

Per Techcrunch, when downloaded, the app provides the user a selection of activities such as “Watch a movie”, “Eat and drink” and “Create your own”. This way they can plan a social event such as a movie outing, group dinners or a visit to a particular destination.

We note that the development had no noticeable impact on Microsoft’s shares as it declined 0.26% on Wednesday. Further, we note that shares of the technology giant have underperformed the Zacks Computer – Software industry over the last one year. While the industry gained 21.7%, the stock registered growth of 20.4%.

The underperformance of the stock could be due to stiff competition in the cloud space and the PC market.

However, we expect the stock to rebound in the rest of 2017 fueled by the company’s initiatives in the “mobile first, cloud first” space.

Microsoft’s Entry into the Social Network Space

Microsoft has built most of its empire on the operating systems business. Gradually, the company shifted its focus to the cloud computing space where it ranks just after Amazon’s (AMZN - Free Report) AWS. The social networking bug hit the technology giant just a few years back with the acquisition of Yammer, a social networking site that specializes in creating private social networks for the employees of a company.

Notably, in Dec 2016, Microsoft completed its acquisition of LinkedIn for $26.2 billion so as to bring together two of the world’s leading platforms – a professional cloud (Azure) and a professional network (LinkedIn). Moreover, many of LinkedIn services have also been integrated within Microsoft products since the acquisition.

Is it Poised to Benefit?

Over the past decade, social media marketing has caught the attention of advertisers, given the popularity of the medium among the masses. These platforms offer an excellent media for advertisers to put their message across through display advertisements.

As per a statista.com study, worldwide social media users are estimated to be approximately 2.95 billion by 2020, which is a big opportunity in itself.

LinkedIn currently has 467 million registered users. With Yammer and now the Who’s In app, Microsoft is trying to expand its user base in the social networking space. An increasing user base would lead to more ad space for the company. This will help it to monetize its platforms.

Although, competition is stiff in the social networking space with the presence of major players such as Facebook , Twitter and Google+, Microsoft looks poised to gain further traction in the space with the recent launch. 

Zacks Rank

At present Microsoft carries a Zacks Rank #3 (Hold). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.

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