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Westpac Banking Corp (ASX: WBC) will pay out an estimated $87 million to customers who were not provided with critical information from its financial advice business.

The Australian Securities and Investments Commission revealed Friday that the bank had agreed to compensate the clients that were impacted by failures between 2005 and 2019.

The 32,000 affected customers held ASX shares through Westpac’s advice arm. The bank failed to notify them of an estimated 328,000 “corporate actions” over those 14 years.

Corporate actions include common ASX company activities like share buybacks, rights issues, share purchase plans and acquisitions.

“Westpac’s failure to notify customers of corporate actions means customers may have missed out on various opportunities,” the regulator stated.

“These include purchasing additional shares often at a discount to the market price, the creation of temporary rights or options that can be sold for a profit, and the ability to sell shares and receive a benefit that can be tax advantageous depending on the shareholder’s circumstances.”

A Westpac spokesperson confirmed the payout to The Motley Fool.

“Westpac apologises to any client of its former advice business who may be impacted by this issue,” said the spokesperson.

“Westpac reported this matter to ASIC in July 2019 and is remediating all impacted clients as appropriate. The group disclosed that it had provisioned for the corporate actions matter in April 2020.”

The Westpac share price is up 0.43% in early Friday morning trade, going for $25.76. It’s up more than 30% on the year.

Westpac to hand out remediation by the end of the year

ASIC commissioner Danielle Press said compensating clients impacted by misconduct is a critical part of holding a financial licence.

“We are pleased to see that Westpac has taken action to remediate affected customers regardless of how much time has passed.”

The bank is aiming to complete the payouts by the end of this year.

For those missed notifications that have been deemed not worthy of compensation, clients will be informed of the corporate actions retrospectively.

Press encouraged customers of Westpac’s advice arm during the impacted time period to request further information from the bank.

Westpac’s advice brands affected by the compensation include Securitor Financial Group Limited, Magnitude Group Pty Ltd and BT Financial Advice. 

Those brands stopped providing personal financial advice in 2019.

The bank first reported its failures to ASIC in 2019, then revealed further details on the matter in April last year.

The post Westpac (ASX:WBC) to pay $87 million compensation to customers appeared first on The Motley Fool Australia.

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Motley Fool contributor Tony Yoo has no position in any of the stocks mentioned. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. has no position in any of the stocks mentioned. The Motley Fool Australia has no position in any of the stocks mentioned. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Bruce Jackson.

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The AVZ Minerals Ltd (ASX: AVZ) share price has returned from its trading halt and is sinking.

In morning trade, the lithium explorer’s shares are down 8% to 14.7 cents.

Why is the AVZ Minerals share price is sinking?

The AVZ Minerals share price has come under pressure on Friday after it announced the outcome of an institutional placement.

According to the release, the company has received firm commitments for a placement to raise $40 million from sophisticated, professional, and institutional investors. Management notes that the placement was heavily oversubscribed, allowing the AVZ Board to increase it by $10 million more than previously sought.

Among the investors were high-quality institutions from Australia and North America, including a European-based physical energy commodities merchant.

The funds were raised at an issue price of $0.13 per share, which represents a sizeable discount of 18.8% to the last closing price.

Why is AVZ raising funds?

These funds will be used to accelerate the advancement of the Tier 1 Manono Lithium and Tin Project in the Democratic Republic of the Congo. This includes progressing towards a final investment decision (FID) for the commencement of project development.

In addition, the company intends to use some of the funds to increase its interest in the project to 75% from 60%.

AVZ’s Managing Director, Nigel Ferguson, said: “The capital raising marks an important milestone in our journey to develop the Manono Project, providing AVZ with the required funds to increase the Company’s stake in the Project and secures the necessary working capital to commence the early capital works program.”

“Increasing AVZ’s equity stake to 75% of the Manono Project adds significant value to AVZ shareholders, including the possible option to attract strategic cornerstone equity partners at the project level, which will assist to de-risk and potentially accelerate Manono’s development.”

“The placement also assists our financing discussions, providing capital for up-front debt finance establishment costs, ensuring minimum liquidity requirements are met, whilst providing debt financiers with confidence from seeing a transition to a larger, supportive non-retail shareholder base, providing AVZ with a solid foundation from which to negotiate favourable terms,” he added.

The post Why the AVZ (ASX:AVZ) share price is sinking 8% today appeared first on The Motley Fool Australia.

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Motley Fool contributor James Mickleboro has no position in any of the stocks mentioned. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. has no position in any of the stocks mentioned. The Motley Fool Australia has no position in any of the stocks mentioned. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Bruce Jackson.

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Shares in Chalice Mining Ltd (ASX: CHN) are up this morning following news from the company’s Julimar nickel-copper-platinum element project. The Chalice Mining share price is currently $7.13 – 2.15% higher than its previous closing price.

The latest news from Chalice is of more high-grade assay results from a step-out drilling program, further defining the Julimar project’s mineralisation.  

What were the findings?

Today, Chalice declared initial assay results from a drilling program at its Julimar project’s Gonneville intrusion have found significant high-grade mineralisation.

The company reported results from 75 new drill holes. They found:

• 298 mineralised intervals (more than 4 metres wide and more than 0.3 grams of palladium per tonne cut-off grade)
• 215 high-grade platinum group element intervals (more than 2 metres wide and more than 1 gram of palladium per tonne cut-off grade), including:
  • 53 high-grade palladium-nickel-copper intervals (more than 2 metres wide, more than 1 gram of palladium per tonne and more than 0.5% nickel and copper cut-off grade)

Chalice is expecting to get results from another 137 drill holes back within the next 9 weeks. The drilling program is ongoing.

About Chalice’s Julimar project

The Julimar project is just 70km north-east of Perth, Western Australia.

A maiden mineral resource estimate for the project’s Gonneville discovery is expected in the final quarter of this year.

Additionally, the Gonneville discovery is seemingly part of a roughly 26km-long intrusive complex named the Julimar complex. Chalice has identified several highly prospective targets along the complex, but they haven’t been drill tested yet.  

Chalice expects to begin exploration, resource definition, and environmental baselining and studies at Julimar during the current financial year.

Commentary from management

Chalice’s managing director Alex Dorsch said:

These latest results confirm continuous zones of high-grade sulphide mineralisation, as well as a large oxide / disseminated sulphide footprint…

Step-out drilling is continuing to test the extent of the Gonneville intrusion in this direction. Our understanding of the geology and metallogenesis of the deposit continues to improve as we gather more data.

Concurrently with the 7-rig resource drill-out, we are also progressing a comprehensive metallurgical testwork program on both the sulphide and oxide mineralisation at Gonneville.

Chalice Mining share price snapshot

Since being crowned one of the ASX’s best performing mining shares in financial year 2021, the Chalice share price has slid 5.9%.

However, it’s still 62% higher than it was at the start of 2021. It has also gained a whopping 658% since this time last year.

The company has a market capitalisation of around $2.5 billion, with approximately 346 million shares outstanding.  

The post Chalice (ASX:CHN) share price gaining on high-grade assay results appeared first on The Motley Fool Australia.

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Motley Fool contributor Brooke Cooper has no position in any of the stocks mentioned. 

The Motley Fool Australia’s parent company Motley Fool Holdings Inc. has no position in any of the stocks mentioned. The Motley Fool Australia has no position in any of the stocks mentioned. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Bruce Jackson.

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FY21 has been a positive year for blue chip shares with the S&P/ASX 200 Index (ASX: XJO) rising 20.44%. A great result compared to this time last year when the ASX 200 had plummeted 11 per cent amid the economic impacts of COVID-19.

The index is the benchmark for Australian equity performance as it lists the 200 largest ASX stocks. We take a look at 3 ASX 200 stocks that were growth outliers in FY21.

Netwealth Group Ltd (ASX: NWL)

In the past 12 months, the Netwealth share price has shot up more than 76%. As well as more than tripling the ASX 200 index increase, the company has also exceeded the Australian Capital Markets industry which returned 20.8% over the past year.

It seems Netwealth has been riding the perfect storm. In its half-yearly report, the financial services company increased its funds under administration (FUA) for the half by $7.3 billion, or around 23%, taking its total FUA as at 31 December 2020 to $38.8 billion.

In April, Netwealth released its third-quarter update which showed Netwealth’s FUA had reached $41.8 billion. An increase of $3 billion or 7.8% since the end of December, including a positive market movement of $0.8 billion.

As of 29 June, investment company BlackRock put the average price-to-earnings (P/E) ratio across the ASX 200 at 24.47. Netwealth’s P/E ratio currently sits at 78.53. The Netwealth share price was trading at $16.75 at market close on Thursday.

Goodman Group (ASX: GMG)

The Goodman Group share price increased 34.3% over the past 12 months. The property group also performed well when compared to the real estate investment trust (REIT) industry which returned 24% over the same time.

Goodman is a property services group with a $39 billion market cap. In its half-year results for the six months ended 31 December, the company reported a 16% increase in operating profit to $614.9 million. In addition, demand for its properties were so strong, that the company leased an additional 1.9 million square metres. 

Goodman ended the third quarter on a positive note, its earnings results for that period showing a net property income increase of 3.3% and an occupancy rate standing at 98%.

Goodman’s P/E ratio currently stands at 22.4 which appears a fair value compared to the index. The Goodman share price closed at $21 on Thursday.

Sonic Healthcare Limited (ASX: SHL)

Sonic Healthcare was another top performer in FY21, returning a solid 24% lift over the last 12 months. This beats the ASX 200 index as well as the Australian healthcare industry which increased over the same period by 18%.

Sonic Healthcare is a global pathology and medical imaging provider. In February, Sonic’s half-yearly report was full of positive news including revenue growth of 33% to $4.4 billion, earnings before interest, tax, depreciation and amortisation (EBITDA) growth of 89% to A$1.3 billion and net profit growth of 166% to $678 million.

In June, Sonic took a significant step, by acquiring the Canberra Imaging Group (CIG). The company called this “a positive step” in the development of its imaging division in Australia.

On 30 June, Sonic shares hit an all-time high of $38.51. Despite the growth, Sonic Healthcare is still well-priced according to its P/E ratio of around 19.

The Sonic share price was trading at $38.08 at Thursday’s market close.

The post 3 blue chip shares that smashed the ASX 200 index in FY21 appeared first on The Motley Fool Australia.

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Motley Fool contributor Frank Tzimas has no position in any of the stocks mentioned. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. owns shares of and has recommended Netwealth. The Motley Fool Australia owns shares of and has recommended Netwealth. The Motley Fool Australia has recommended Sonic Healthcare Limited. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Bruce Jackson.

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It’s head above the clouds for the ResMed Inc (ASX: RMD) share price, which marked a new all-time high of $33.14 on 30 June.

Despite no price-sensitive news last month, shares in the respiratory device company rallied by an impressive 20.8%.

Let’s take a closer look at what might have influenced the move to record highs.

ResMed share price surges after product recall

Health technology conglomerate Philips announced a major product recall for a number of its ventilator devices to “address identified potential health risks”.

Philips identified potential health risks relating to the polyester-based polyurethane (PE-PUR) sound abatement foam component in these devices.

The company said the PE-PUR foam may degrade into particles, entering the device’s air pathway and be ingested or inhaled by the user.

While there have been no reports of death, the company flagged potential risks including headache, irritation, inflammation, respiratory issues, and possible toxic and carcinogenic effects.

Philips released this news on 14 June, coinciding with a 6.39% surge in ResMed shares to $30.31.

By month’s end, the ResMed share price would rally by 15.11% to $32.79.

What else should investors know?

Investors might want to note the volatile nature of ResMed shares, especially in the wake of its quarterly results.

Take the company’s most recent third quarter results on 30 April, for example.

ResMed reported a 0.1% fall in revenue to US$768.8 million against the elevated prior corresponding period. This period was boosted by heightened demand for its ventilators amid the peak of COVID-19.

Unfortunately, the ResMed share price crashed 6.34% to $25.41 on the day of the announcement.

Similarly, its second quarter results also exhibited a wild swing in share price. It slipped 1.09% on the day of the announcement and a further 3.57% the next day to $26.44.

However, the quarterly results do not always signal a fall.

The company’s first quarter results on 30 October 2020 witnessed a 9.45% spike in the ResMed share price to $27.92.

The post The ResMed (ASX: RMD) share price was up 20% in June. Here’s why appeared first on The Motley Fool Australia.

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Motley Fool contributor Kerry Sun has no position in any of the stocks mentioned. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. has recommended ResMed. The Motley Fool Australia has recommended ResMed Inc. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Bruce Jackson.

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The Piedmont Lithium Inc (ASX: PLL) share price is under pressure on Friday despite announcing its expansion into Africa.

At the time of writing, the lithium explorer’s shares are down 1% to $1.03.

Why is the Piedmont Lithium share price under pressure?

This morning Piedmont Lithium announced definitive agreements to establish a strategic partnership with IronRidge Resources (IRR) through the purchase of an equity stake in the London listed lithium explorer.

According to the release, Piedmont Lithium will invest approximately $15 million (10.8 million pounds) to acquire a 9.47% equity interest in IRR. In addition to this, Piedmont Lithium has the opportunity to earn a 50% stake in IRR Ghana business.

The release notes that IRR Ghana has an impressive portfolio of spodumene prospects, anchored by the highly promising Ewoyaa Project. This project has a current mineral resource of 14.5Mt @ 1.31% lithium oxide with vast exploration potential. Management believes it has the potential to be a large, low-cost spodumene concentrate (SC6) producer.

To earn a 50% interest in the IRR Ghana business, Piedmont Lithium will need to invest $17 million to fund ongoing exploration and a definitive feasibility study over the next 24 months and then a further $70 million in 2023-2025 to fund the construction of the Ewoyaa Project.

After which, the two parties have entered into a binding SC6 supply agreement, conditioned on Piedmont Lithium completing its earn-in obligations, pursuant to which IRR will supply it with 50% of IRR Ghana’s planned SC6 production (currently estimated to be 147,500 tonnes per year) at market prices on a life-of-mine basis.

While the company has a strong balance sheet, investors may be concerned that this development will require another capital raising in the not so distant future.

Management commentary

Piedmont Lithium’s President and Chief Executive Officer, Keith D. Phillips, commented: “We are very pleased to announce a partnership with IronRidge Resources to jointly develop their outstanding spodumene project portfolio in Ghana. We consider IRR’s Ewoyaa Project to be among the world’s most promising spodumene projects.”

“The high-grade mineral resource is currently modest in scale but offers substantial exploration potential, and the project is very well-located, being only 70 miles from a major port. Ewoyaa builds on Piedmont’s strategic commitment to be a large-scale and low-cost producer of lithium hydroxide from spodumene concentrate sourced from diverse sustainable resources in favorable jurisdictions,” he added.

Despite today’s weakness, the Piedmont Lithium share price is still up almost 180% in 2021.

The post Piedmont Lithium (ASX:PLL) share price slides despite African expansion appeared first on The Motley Fool Australia.

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Motley Fool contributor James Mickleboro has no position in any of the stocks mentioned. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. owns shares of and has recommended Piedmont Lithium Inc. The Motley Fool Australia has no position in any of the stocks mentioned. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Bruce Jackson.

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The Imugene Limited (ASX: IMU) share price is on course to end the week on a positive note.

In morning trade, the clinical stage immuno-oncology company’s shares are up 8.5% to 38 cents.

This latest gain means the Imugene share price is now up 280% in 2021.

Why is the Imugene share price jumping?

Investors have been bidding the Imugene share price higher today after the release of a positive announcement relating to its oncolytic virotherapy candidate, CHECKvacc.

CHECKvacc, also known as CF33-hNIS-antiPDL1, is Imugene’s novel chimeric orthopoxvirus with robust anti-cancer activity including triple-negative breast cancer (TNBC) xenografts.

According to the release, the City of Hope independent cancer research and treatment centre near Los Angeles has received US Food and Drug Administration (FDA) Investigational New Drug (IND) approval to initiate a Phase I clinical trial of CHECKvacc (CF33-hNIS-antiPDL1).

The FDA approval of the IND allows Imugene and City of Hope to start patient recruitment and dosing in a Phase 1 clinical trial for TNBC patients.

The company advised that the purpose of this study is to evaluate the safety and initial evidence of efficacy of intra-tumoral administration of CF33-hNIS-antiPDL1 against metastatic TNBC. The trial will involve a dose escalation, followed by an expansion to 12 patients at the final dose, the recommended phase 2 dose.

Leading the trial will be Principal Investigator, Dr Yuan Yuan MD, PhD. Dr Yuan said “Our team is excited to be part of this important study and the search for effective new treatments for triple negative breast cancer as there are limited options for patients.”

“A crucial step forward”

Imugene’s MD & CEO, Leslie Chong, appears to be very pleased with the news.

She said: “City of Hope and Dr Yuan Yuan receiving their IND approval for CHECKvacc from the FDA is a crucial step forward for Imugene. The start of our CF33 OV study is a significant milestone for clinicians treating patients faced with the challenge of triple-negative breast cancer. Accomplishing this goal speaks to the perseverance and dedication of Imugene’s and City of Hope’s clinical and research teams as we continue to build on our clinical and commercial potential.”

The post Imugene (ASX:IMU) share price jumps 8% on FDA update appeared first on The Motley Fool Australia.

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Motley Fool contributor James Mickleboro has no position in any of the stocks mentioned. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. has no position in any of the stocks mentioned. The Motley Fool Australia has no position in any of the stocks mentioned. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Bruce Jackson.

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If you’re interested in gaining some exposure to the tech sector, then you might want to take a look at these highly rated options.

Both of the tech shares listed below have been tipped to grow strongly over the long term. Here’s what you need to know about them:

Dubber Corp Ltd (ASX: DUB)

The first tech share to look at is Dubber. It is a software company that provides businesses with a scalable call recording service. This service has been adopted as core network infrastructure by multiple global leading telecommunications carriers in North America, Europe and the Asia Pacific.

The company’s cloud-based technology allows businesses to record, manage, and analyse their phone calls and communications.

Demand for its offering has been growing strongly over the last couple of years, leading to a significant increase in active customers and revenue. This was on show in its recent third quarter update, which revealed a 20% increase in annualised recurring revenue (ARR) over the three months to $34 million. This was also a 158% increase over the prior corresponding period.

Since then, Dubber has signed a potentially game-changing deal with global giant Cisco. This will see Cisco Webex Calling and Cisco Unified Communications Manager Cloud (UCM) now include Dubber call recording as part of all services at no additional cost to users. This gives Dubber significant upselling opportunities.

Shaw and Partners currently has a buy rating and $3.03 price target on its shares. This may mean investors would be best waiting for a pullback before considering an investment.

Nearmap Ltd (ASX: NEA)

Another ASX tech share to look at is Nearmap. It is an aerial imagery technology and location data company.

Its technology shifts location analysis out of the field and into the office, providing businesses with the tools to scale quickly and bring their most important initiatives to life.

Thanks to increasing demand for its services in North America, Nearmap has been growing at a solid rate in FY 2021. So much so, it recently upgraded its Annual Contract Value (ACV) guidance to between $128 million and $132 million from between $120 million and $128 million. This will be a 20% to 24% increase from $106.4 million in FY 2020.

Looking ahead, management appears confident in its growth trajectory. It is targeting annualised contract value (ACV) growth of 20% to 40% per annum over the long term, with underlying churn of less than 10%.

Morgan Stanley remains bullish on the company despite its recent legal issues. It currently has an overweight rating and $3.20 price target on its shares.

The post 2 highly rated ASX tech shares tipped for strong long term growth appeared first on The Motley Fool Australia.

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Motley Fool contributor James Mickleboro has no position in any of the stocks mentioned. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. owns shares of and has recommended Dubber Corporation and Nearmap Ltd. The Motley Fool Australia owns shares of and has recommended Dubber Corporation and Nearmap Ltd. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Bruce Jackson.

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The BWX Ltd (ASX: BWX) share price will be one to watch this morning.

Before market open, the natural beauty and wellness company’s shares are fetching $5.23 a piece.

What did BWX announce?

The company this morning announced the completion of its Flora & Fauna acquisition.

Flora & Fauna was established in 2014 and has since become one of Sydney’s leading online retailers for vegan products. It has more than 94,000 active customers across 300 brands that span multiple categories such as clothing and accessories, skincare, and food.

BWX originally announced the acquisition on 17 May as a plan to expand the company’s e-commerce offering.

According to today’s release, BWX has completed the acquisition for an estimated total consideration of $27.9 million. This reflects an acquisition multiple of 1.7 times actual net revenue for FY21.

BWX Group chief executive officer Dave Fenlon said:

BWX is at the forefront of the global wellness revolution, and now our business is even more leveraged to industry and digital tailwinds through this acquisition. Importantly it supports our ambition to stay connected with our consumers and their values. Demand for nondiscretionary skincare remains strong but has been buoyed by preferences for ethical, vegan and sustainable products.

Flora & Fauna founder, Julie Mathers, has been appointed managing director of the new business unit which consists of Nourished Life and Flora & Fauna. The appointment is effective as of today.

Trading update

In addition to the acquisition, BWX provided a trading update for the newly integrated business.

The release noted Flora & Fauna is on track to deliver total net revenue of $16.4 million in FY21 – an increase of 35% on FY20.

Additionally, BWX noted it has paid an instalment of the total consideration. It is anticipated the remaining balance will be paid in the first quarter of FY22, subject to finalisation of the closing accounts.

BWX share price compared to ASX 200

The BWX share price outpaced the S&P/ASX 200 Index (ASX: XJO) in the last financial year. While the Aussie benchmark index pulled a respectable 20% return, the beauty company surged 39%.

Despite the strong performance, BWX is still below its all-time high of $7.74 a share.

The post BWX (ASX:BWX) share price on watch after completing acquisition appeared first on The Motley Fool Australia.

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Motley Fool contributor Mitchell Lawler has no position in any of the stocks mentioned. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. has no position in any of the stocks mentioned. The Motley Fool Australia owns shares of and has recommended BWX Limited. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Bruce Jackson.

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This article was originally published on Fool.com. All figures quoted in US dollars unless otherwise stated.

This article was originally published on Fool.com. All figures quoted in US dollars unless otherwise stated.

Microsoft (NASDAQ: MSFT) recently introduced Windows 11, which will be offered as a free upgrade for Windows 10 users later this year. That announcement likely surprised some investors, since Microsoft had previously called Windows 10 its “last version” of Windows.

That statement was based on the transformation of Windows into a cloud-based service that could be continuously updated online and monetized through its app store. Windows 11, though bearing a new name, really just marks a continuation of that strategy. Let’s see what this new OS means for Microsoft’s investors.

The business of Windows

Windows is Microsoft’s most well-known product, but the tech giant only generated 14% of its revenue from its Windows division last quarter. This segment houses its OEM and enterprise licenses, Windows-based cloud services, IoT (Internet of Things) services, patent licenses, and MSN ads.

Before Microsoft launched Windows 10 as a free upgrade for a limited time in 2015, PC users needed to buy new versions of Windows every few years. But many consumers simply stuck with older versions of Windows — which fragmented the OS and prevented Microsoft from launching unified upgrades and services. Microsoft also wasted resources by supporting outdated versions.

Satya Nadella, who took over as Microsoft’s third CEO in 2014, addressed the problem by offering Windows 10 as a free OS for consumers — like iOS and Android — and then monetizing it with an app store and other integrated features.

Microsoft continued to sell Windows 10 licenses to PC makers and enterprise customers, so the overall impact of temporarily “giving away” Windows to consumers wasn’t that significant. Microsoft also expanded its commercial cloud business to reduce its overall dependence on Windows licenses.

Microsoft’s annual revenue soared from $86.8 billion to $143 billion between fiscal 2014 and 2020. But between those years, the Windows division’s weight on Microsoft’s top line fell from 19% to 16% and continued declining throughout fiscal 2021.

Why Windows 11 is a smart move for Microsoft

The overall financial importance of Windows licenses is fading, but it will still serve as the foundation of many of Microsoft’s cloud-based services and apps.

On the surface, Windows 11 provides a simpler interface than Windows 10 by streamlining some settings, eliminating some apps, and updating its visuals. But it also makes major changes under the hood.

The new Microsoft Store in Windows 11 will be directly integrated with Amazon‘s (NASDAQ: AMZN) Android App Store. Therefore, users can install both Windows apps and over half a million Android apps. That integration — along with its enhanced touchscreen, voice commands, and stylus features — could make the OS more appealing for tablet users.

Windows 10 also ditches Skype and promotes Teams as its default communications platform. That may seem like an odd move since Microsoft paid $8.5 billion for Skype back in 2011, but pulling everyone onto Teams could eliminate the lingering redundancies between the two services. Microsoft already rolled many of Skype’s enterprise features into Teams in 2017, so the decision wasn’t all that surprising.

Windows 11 should also be a more secure OS than its predecessor since it will only run on devices that have a TPM (Trusted Platform Module) 2.0. A TPM is a chip that shields a PC from hardware-based attacks while booting, and it’s required for some of Windows 11’s new security features.

Why Windows 11 might cause problems for Microsoft

However, Windows 11’s new hardware requirements could cause many users to stick with Windows 10.

Many PCs that have shipped since the launch of Windows 10 still do not have TPMs. The minimum RAM and storage requirements for Windows 11 are also roughly double the minimum requirements for Windows 10. The Verge estimates those higher requirements could leave “millions of PCs behind.”

Microsoft plans to continue supporting Windows 10 through 2025, so it’s probably anticipating a slow roll out as the hardware catches up to its new software. That’s a smart long-term move, but it could cause some short-term fragmentation between Windows 10 and 11 users.

Was this the right move for Microsoft?

Microsoft’s introduction of Windows 11 indicates its flagship OS continues to evolve as a cloud-based service, it will support new apps and features, and it will be more secure than its predecessor.

That’s all great news for the Windows business, but investors should keep a closer eye on Microsoft’s expanding commercial cloud business, which has driven most of its growth over the past few years, instead of fretting over the finer technical details of its upcoming Windows 11 upgrade.

This article was originally published on Fool.com. All figures quoted in US dollars unless otherwise stated.

The post Will Windows 11 Help or Harm Microsoft Investors? appeared first on The Motley Fool Australia.

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Leo Sun owns shares of Amazon. John Mackey, CEO of Whole Foods Market, an Amazon subsidiary, is a member of The Motley Fool’s board of directors. Teresa Kersten, an employee of LinkedIn, a Microsoft subsidiary, is a member of The Motley Fool’s board of directors. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. owns shares of and has recommended Amazon and Microsoft. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. has recommended the following options: long January 2022 $1,920 calls on Amazon and short January 2022 $1,940 calls on Amazon. The Motley Fool Australia has recommended Amazon. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Bruce Jackson.

This article was originally published on Fool.com. All figures quoted in US dollars unless otherwise stated.

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