Microsoft reports 4th quarter/year-end earnings
Friday 20th July 2007, 07:01:00 PM, written by Carl Bender
Microsoft yesterday released fourth-quarter and year-end numbers for the fiscal year ended June 30th, 2007, reporting just over $3 billion in earnings for the quarter on the back of $13.37 billion in revenues. For the year, total revenues were up 15% to a record $51.12 billion, with net income up roughly $1.47 billion to $14.07 billion.
As expected, revenue and earnings growth were driven primarily by sales of new Vista and Office licenses, keeping pace with the numbers seen last quarter at the launch of the landmark operating system. Both the Client and the Business Division registered strong earnings, collectively bringing in $8.43 billion in revenue and $5.81 billion in operating income for the quarter. Figures for the year were a collective $31.37 billion in revenue and $22.44 billion in operating income for both divisions.
Beyond Vista/Office-related earnings, Microsoft SQL Server penetration helped push the Server and Tools division to post a 15% increase in both revenue and income vs the year-ago period, reaching to $3.08 billion and $1.05 billion, respectively. Online Services increased revenues 19% to $688 million for the quarter vs '06, but widened its losses to $289 million from $187 million. Later this year Microsoft will look to gain shareholder approval for its purchase of aQuantive, Inc., which it will seek to leverage in the online services space.
In the high-profile Entertainment and Devices division, attention centered on the $1.06 billion charge taken in association with the XBox 360 warranty extension and its effects on per-share earnings. Microsoft asserts that the charge cost them $0.08/share in earnings for the quarter, and brought the division losses for the year to $1.89 billion vs $1.28 for fiscal '06. Without the charge, quarterly losses would have come to $140 million - a marked improvement over previous quarters that in part reflects the lowered manufacturing costs of new revision XBox 360s. Although Microsoft shipped fewer consoles than in the year-ago period, increased sales of Zune media players and Windows Mobile licenses were credited in helping to partially offset the overall revenue decline to $1.16 billion for the quarter. Microsoft reiterated their goal of division profitability in fiscal 2008 on the heels of a strong software lineup for the XBox 360.
The overall billing break-out for the company was indicated as 30% to OEMs and 40% for multi-year agreements, with "license only" and 'other' each constituting 15% of group revenues. During their call, Microsoft also sought to highlight recent acquisitions and the ongoing share buyback program as corporate-level efforts undertaken to further enhance shareholder value.
The Microsoft earnings release and investor conference call may both be found on Microsoft's investor relations page.
As expected, revenue and earnings growth were driven primarily by sales of new Vista and Office licenses, keeping pace with the numbers seen last quarter at the launch of the landmark operating system. Both the Client and the Business Division registered strong earnings, collectively bringing in $8.43 billion in revenue and $5.81 billion in operating income for the quarter. Figures for the year were a collective $31.37 billion in revenue and $22.44 billion in operating income for both divisions.
Beyond Vista/Office-related earnings, Microsoft SQL Server penetration helped push the Server and Tools division to post a 15% increase in both revenue and income vs the year-ago period, reaching to $3.08 billion and $1.05 billion, respectively. Online Services increased revenues 19% to $688 million for the quarter vs '06, but widened its losses to $289 million from $187 million. Later this year Microsoft will look to gain shareholder approval for its purchase of aQuantive, Inc., which it will seek to leverage in the online services space.
In the high-profile Entertainment and Devices division, attention centered on the $1.06 billion charge taken in association with the XBox 360 warranty extension and its effects on per-share earnings. Microsoft asserts that the charge cost them $0.08/share in earnings for the quarter, and brought the division losses for the year to $1.89 billion vs $1.28 for fiscal '06. Without the charge, quarterly losses would have come to $140 million - a marked improvement over previous quarters that in part reflects the lowered manufacturing costs of new revision XBox 360s. Although Microsoft shipped fewer consoles than in the year-ago period, increased sales of Zune media players and Windows Mobile licenses were credited in helping to partially offset the overall revenue decline to $1.16 billion for the quarter. Microsoft reiterated their goal of division profitability in fiscal 2008 on the heels of a strong software lineup for the XBox 360.
The overall billing break-out for the company was indicated as 30% to OEMs and 40% for multi-year agreements, with "license only" and 'other' each constituting 15% of group revenues. During their call, Microsoft also sought to highlight recent acquisitions and the ongoing share buyback program as corporate-level efforts undertaken to further enhance shareholder value.
The Microsoft earnings release and investor conference call may both be found on Microsoft's investor relations page.
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