Microsoft Wins BIG Military Contract
Augmented Reality Headsets X U.S. Army
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$MSFT
To start, $MSFT (my biggest holding), has been on an absolute run this past year - in my opinion, it's justified.
Here are some incredible 2020 stats:
Revenue: $143 B (12% YoY)
Net Income: $44 B (11% YoY)
Free Cash Flow: $50 B (24% YoY)
Also, just the other day they won a U.S. Army AR headset contract worth $21B!
This augmented reality headset deal is a BIG deal and $MSFT shares rose after hours in response. The contract is for more than 120,000 headsets that will be made in the U.S. Microsoft said the headsets "will keep soldiers safer and make them more effective". Here is a look at these previously made augmented reality headsets.
What is the difference between AR and VR?
VR: Virtual reality is a computer-generated simulation of an alternate world/reality. VR creates simulations meant to “immerse” the viewer by using computers & sensory equipment such as headsets & gloves. Think of the Matrix.
AR: Augmented Reality is like VR but instead of a fully immersive experience it is a layered effect of projecting a computer-generated setting over a real-life background. A great example is Pokemon Go... As you can see, this can be beneficial for operators in training.
The Headset Wars
This deal in all honesty was a somewhat shock to me considering Facebook, Apple, & Google have all been battling AR/VR headset space for quite some time. Remember Google Glass? Facebook's Oculus vs. Apple's upcoming release (which might cost in the 1000s) has started to become a center stage but $MSFT landed the government contract.
I am long $AAPL $MSFT & $FB and I truly believe AR/VR will be a huge thing in the future. My hope is we have our own Oasis like in the movie “Ready Player One”. In my opinion, I think Facebook has the edge currently with Oculus 2 and its drive to have a very affordable product. But like most Apple products, people might be willing to pay the steep premium if it’s worth it.
Below is an excellent example of how incredible augmented reality glasses can be in the very near future…
Lastly, here is an article that covers the AR/VR Headset wars in the future between Apple and Facebook.
Hope you have a great rest of the week,
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