Microsoft Q2 net income flat at $6.62 bn


Bill Gates at Press Conference at NewYork
NEW YORK: Software major Microsoft Corp has reported a negligible decline in net income to USD 6.62 billion for the October-December quarter of 2011, even though demand for software and services remained high.

The company had posted a net income of 6.63 billion dollars for the corresponding year-ago period, Microsoft said in a statement.

The company's revenue stood at 20.89 billion dollars in the second quarter ended December 31, 2011, a 5 per cent increase vis-a-vis the year-ago period.
Microsoft, which is struggling amid a weak PC market, has witnessed strong demand in the software and services segment and robust sales of its Xbox game console and Kinect motion controller.

"We delivered solid financial results, even as we prepare for a launch year that will accelerate many of our key products and services," company CEO Steve Ballmer said.

"Coming out of the Consumer Electronics Show, we're seeing very positive reviews for our new phones and PCs and a strong response to our new Metro style design that will unify consumer experiences across our phones, PCs, tablets, and television in 2012," he added.

Microsoft business division posted 6.28 billion dollars in second quarter revenue, a 3 per cent growth vis-a-vis the corresponding period a year ago.

Server and tools business accounted for 4.77 billion dollars of second quarter revenue, an 11 per cent increase in comparison to the previous year, reflecting double-digit revenue growth in Windows Server and SQL Server premium editions and more than 20 per cent growth in system centre revenue.

In addition, online services segment revenue grew by 10 per cent to 784 million dollars, while revenues from Microsoft's entertainment and devices division rose by 15 per cent to 4.24 billion dollars.

There are now about 66 million Xbox 360 consoles in the market, along with 18 million Kinect sensors. Xbox Live memberships increased by 33 per cent to 40 million in the reporting quarter.

In contrast, revenue from the Windows and Windows Live division dipped by 6 per cent to 4.74 billion dollars.

"We saw strong demand for our business products and services despite the soft PC market and continuing economic uncertainty in key parts of the world," Microsoft CFO Peter Klein said, adding, "We delivered record earnings per share by continuing to manage our costs while investing for future growth."

Looking ahead, Microsoft has revised downward its operating expense guidance to a range between 28.5 billion dollars and 28.9 billion dollars for the full year ending June 30.

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