Microsoft (Yawn) Breaks Revenue Record Again

In a traditionally slow quarter, Microsoft broke revenue records but just barely.

Microsoft kicked off its first quarter of fiscal 2012, which ended Sept. 30, by once again breaking previous revenue records.

For the quarter, Microsoft (NASDAQ: MSFT) posted revenues of $17.37 billion, a gain of 7 percent over the first quarter of fiscal 2010.

Diluted earnings per share (EPS) came in at $0.68, up 10 percent from the year ago quarter. Analysts polled by Thomson Financial Network had, on average, expected $0.68 per share.

Meanwhile, Microsoft announced operating income of $7.2 billion, a 1 percent increase, and net income of $5.74 billion, up 6 percent, over the same period last year.

The summer quarter is typically the slowest period of the year for Microsoft.

"We saw customer demand across the breadth of our products, resulting in record first-quarter revenue and another quarter of solid EPS growth," Peter Klein, Microsoft's CFO, said in a statement.

Microsoft credited a number of product groups for helping bring in another record quarter of revenues.

"We had another strong quarter for Office, SharePoint, Exchange, and Lync, and saw growing demand for our public and private cloud services including Office 365, Dynamics CRM Online, and Windows Azure," Kevin Turner, Microsoft COO, said in a statement.

The Microsoft Business Division, which includes Office, Lync, SharePoint, and Exchange as well as the Dynamics line, contributed $5.62 billion to the bottom line, up 8 percent year-on-year, while the Server & Tools Division posted $4.25 billion, an increase of 10 percent.

The Windows and Windows Live Division, meanwhile, grew revenues only slightly, 2 percent over last year, at $4.87 billion, despite having sold 450 million Windows 7 licenses since the current version launched in October 2009.

Executives made passing references to Windows Phone 7.5, which just launched, and put a smiley face on search engine Bing's growth, which overall holds a 27 percent share in the U.S., though, like Windows Phone, it is still a net loser on the balance sheet.

Turner did, however, give reason for optimism in the upcoming holiday shopping season.

"With a great set of consumer products like Windows 7 PCs, Windows Phone 7.5, Xbox and Kinect, we are excited about the holiday buying season," Turner's statement said.

Microsoft pointed out that it just completed its acquisition of Skype so it had no impact on the first quarter, but will in the second quarter.

Last quarter, which was the fourth quarter of Microsoft's fiscal 2010, the company also broke previous revenues and earnings records, bringing in revenues of $17.3 billion, an 8 percent gain from the same quarter in fiscal 2009. Diluted EPS for last quarter were $0.69, up 35 percent from the same quarter of 2009.

For the entire 2011 fiscal year, which ended June 30, Microsoft posted revenues of $69.94 billion, a 12 percent increase from fiscal 2009, and EPS of $2.69, up 28 percent over the previous year.

Investors appeared unperturbed about the company's results. In early after hours trading, the company's common shares were down $0.32, or 1.18 percent, at $26.72 -- about midway between Microsoft's 52-week high and low.

Stuart J. Johnston is a contributing editor at InternetNews.com, the news service of Internet.com, the network for technology professionals. Follow him on Twitter @stuartj1000.




Tags: Microsoft, earnings, revenue, stock


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