vacancies advertise contact news tip The Vault
facebook rss twitter

Microsoft profits fall 22 per cent as PC sales decline

by Mark Tyson on 19 October 2012, 15:15

Tags: Windows 8

Quick Link: HEXUS.net/qabnz5

Add to My Vault: x

Microsoft has revealed that net income for the quarter ending 30th September dropped 22 per cent to $4.47 billion, that’s 53 cents per share. A year earlier net income was $5.74 billion, or 68 cents per share. Wall Street had expected earnings of 56 cents per share, so Microsoft shares have lost some ground in afterhours trading. Microsoft didn’t include pre-release sales of Windows 8; the extra $1.36 billion of Windows 8 sales made so far will be included in the next quarter results.

In the face of the results Microsoft CEO Steve Ballmer promised a “new era” as the world’s largest software company fights to remain relevant. PCs, from which Microsoft and its old ally Intel make a great deal of their profits, are in decline as people make greater use of mobile computing platforms like tablets and smartphones. Indeed many other PC related hardware and software companies have felt similarly chilly winds from the market, especially if they are struggling to find a way into tablets and mobiles but not really making an impact.

MICROSOFT CORPORATION

SEGMENT REVENUE AND OPERATING INCOME (LOSS)

(In millions) (Unaudited)

Three Months Ended September 30,

 
 
 
 

 

2012

 

2011

 

Revenue

 

 

 

 

Windows & Windows Live Division

 $ 3,244

 

 $ 4,874

 

Server and Tools

4,552

 

4,216

 

Online Services Division

697

 

641

 

Microsoft Business Division

5,502

 

5,635

 

Entertainment and Devices Division

1,946

 

1,961

 

Unallocated and other

67

 

45

 

  Consolidated

 $ 16,008

 

 $ 17,372

 

 

 

 

 

 

Operating income (loss)

 

 

 

 

Windows & Windows Live Division

 $ 1,646

 

 $ 3,270

 

Server and Tools

1,748

 

1,565

 

Online Services Division

(364)

 

(514)

 

Microsoft Business Division

3,646

 

3,717

 

Entertainment and Devices Division

19

 

340

 

Corporate-level activity

(1,387)

 

(1,175)

 

  Consolidated

 $ 5,308

 

 $ 7,203

 

 

You can see from the above except of the company results the parts of Microsoft that are making and losing money and the comparison to last year’s results for the same quarter.

Speaking to Reuters, Daniel Ives, analyst at FBR Capital Markets said “Investors were not expecting a home run. All expectations are on the launch of Windows 8 and the entrance into the tablet market.” He surmised that “In light of the environment, the macro and PC situation, these are respectable numbers.”

Optimistically looking forward, Steve Ballmer said, in an introduction to the report; “Investments we’ve made over a number of years are now coming together to create a future of exceptional devices and services, with tremendous opportunity for our customers, developers, and partners.” This time next year we will know if the investments have paid off, as one of the biggest changes is about to arrive on 26th October.



HEXUS Forums :: 26 Comments

Login with Forum Account

Don't have an account? Register today!
Ole Ballmer still hasn't caught on that his “new era” is what's ruining the company.
aidanjt
Ole Ballmer still hasn't caught on that his “new era” is what's ruining the company.
That's really not a fair thing to say based on the announcements over the last few years.

The problem for me with Ballmer is simple, he might just about be charesmatic enough to run, say one large team, thats it, and thats pushing it too.
I'm no financial wizz, but surely 4.47 billion declared + 1.36 billion undeclared = 5.83 billion which is more than 5.74 billion previous?
Macadee
I'm no financial wizz, but surely 4.47 billion declared + 1.36 billion undeclared = 5.83 billion which is more than 5.74 billion previous?

Lets not let the facts get in the way of a good bash eh!
Windows 8 & Metro = HUGE FAIL