Microsoft announces record Q4 earnings

By Chris Nicholls

REDMOND, USA: Microsoft today announced record second quarter revenue of US$16.7 billion, topping their previous record by US$2 billion.

The company’s bullish results included a rise in operating income of US$6.48 billion, or 87 per cent, year-on-year.

However, Microsoft said last year’s results were diluted by the deferral of $1.64 billion of revenue and operating income and $0.11 of diluted earnings per share, due mainly to technology guarantee programs.

“We are extremely pleased by the broad based strength of our business performance and field execution. Throughout the first half of our fiscal year, all of our businesses met or beat our expectations,” said Microsoft’s chief financial officer, Chris Liddell.

The Redmond company also reported more than 20 per cent growth in their Window’s client base and over 100 million sales of Windows Vista.

“We are pleased with the progress of Windows Vista in the market. We’ve hit our stride with partners and customers and are looking forward to the release of our first service pack later this quarter,” said Kevin Johnson, president of the Platforms and Services Division.

Microsoft Business Division and the Server and Tools business showed double-digit revenue growth rates over the previous year and together increased revenue over US$1 billion compared with Q4 last year. The business division generated 23 per cent revenue growth, which the company put down to new versions of Microsoft Office, Microsoft SharePoint and Microsoft Exchange launched last November.

Sales of the Xbox 360 since launch reached 17.7 million units, representing a 70 per cent increase from the prior year.

Microsoft also reported strong sales in the BRIC markets (Brazil, Russia, India and China), with 65 per cent combined growth rate for the quarter.

Chief operating officer Kevin Turner said the company was “in the midst of another strong year” and had “great momentum heading into calendar year 2008.”

For the next quarter, Microsoft predicted revenues of between $14.3 billion to $14.6 billion, with US$5.6 to 5.7 billion in operating income.

For the full fiscal year to June 30, 2008, Microsoft predicted between US$59.9 billion to $60.5 billion in revenue, with between US$24.2 billion to $24.4 billion in operating income


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