Microsoft Breaks the $50 Billion Mark

internetnews.com ^ | July 19, 2007 | By Stuart J. Johnston

[jdm]

Microsoft (Quote) finally broke the $50 billion barrier for revenues in fiscal 2007 – and the company's financial team is predicting more of the same in the current fiscal year.

For the year, which ended January 30, the company brought in $51.12 billion, up 15 percent from last year's $44.28 billion. For the fiscal fourth quarter, Microsoft chalked up $13.37 billion, a 13 percent jump from last fiscal year's fourth quarter revenues of $11.8 billion.

As to the bottom line, Microsoft brought in a whopping $14.07 billion in reported net income for the year, an 18 percent boost from last year's $12.6 billion.

And the current fiscal year looks to be another bang up year. "[Microsoft is] looking to deliver another year of double-digit revenue growth [in fiscal 2008]," chief financial officer Chris Liddell said on a conference call with analysts Thursday.

In terms of diluted earnings per share, the company logged $1.42 for the full year and $0.31 for the quarter. Microsoft took a $0.08 per share hit in the fourth quarter due to reserves of $1.06 billion that the company set aside in early July to deal with higher-than-expected failure rates of the Xbox 360 gaming console.

During the conference call, Liddell cited double-digit growth in several business sectors as contributors to the fiscal year's record-breaking revenue results. Among those, he said, were the Windows client business -- including Windows Vista which shipped to businesses in the second fiscal quarter and to consumers at the beginning of the third quarter – and the Office System – including Office 2007 which shipped simultaneously with Vista.

Other contributors included strong sales of SQL Server, Windows Server, and the Xbox 360, he said.

Microsoft officials did not give shipment numbers for Vista or Office 2007 or compare Vista shipments to shipments of Windows XP. Continuing strong growth in sales of PCs worldwide bode well for both products in fiscal 2008, however, he said.

Meanwhile, Liddell presented a continuing positive outlook for the current fiscal year. The company has already announced it will ship Windows Server 2008, SQL Server 2008 and Visual Studio 2008 next February about halfway through fiscal 2008.

Additionally, the company is planning a September 25 launch of HALO 3, the third release of its blockbuster Xbox 360 game.

Microsoft's $6 billion acquisition of aQuantive is likely to close in August as well, Liddell said.

In the current quarter, which ends September 30, Microsoft told analysts it expects to bring in between $12.4 billion to $12.6 billion. Meanwhile, for the entire year it said it expects to gross in the range of $56.8 billion to $57.8 billion, with diluted earnings in the range of $1.69 to $1.73 per share.

The company plans to provide significantly more information about both fiscal 2007 results and projections for 2008 next Thursday when it hosts its annual financial analysts meeting on its Redmond campus.

[ShadowAce]

[antiRepublicrat]

Don’t forget the XBox. They’ve taken billions of dollars of loss over the years to get themselves in the console market. Now the 360 is doing well, although the hardware is apparently crap (strange, because MS’s hardware has always been pretty solid).

[SwordofTruth]

"Windows Media is now the dominant delivery codec for streaming audio and video on the web (except for movie trailers, where Quicktime still dominates)."

You sound like a MS marketing guy/gal to me. The dominant delivery codec for streaming audio and video is not either Windows media or Quicktime, it is Adobe's Flash player.

[unixfox]

Microsoft makes $50B -— and not a word!

Ah, but remember when Janet Reno and her ilk tried to take down Microsoft? Simply because Microsoft didn't want to play their game.

[DesScorp]

“You sound like a MS marketing guy/gal to me.”

Sorry to disappoint you, but no. And go to your local news websites. What are they streaming in? Go to radio websites. What are they streaming in? Outside of Itunes, what is the dominant format for song purchases?

Flash is great for animation and quick videos on youtube, but try finding a place that offers song downloads in flash.

[SkyDancer]

I’m through with upgrading ... still trying to run Outlook without it freezing up ... MS says I have to upgrade to Office2007 ... can’t afford it - I have Office2000 and they want $125 for the upgrade key .....

[rlmorel]

"...Ah, but remember when Janet Reno and her ilk tried to take down Microsoft? Simply because Microsoft didn't want to play their game.

LOL...they just fixed it so anytime someone at the Justice Department logged onto their PC, it would tell them they had to authorize their original copy of Windows XP before they could continue...:)

[TopQuark]

And how does that change the point being made?

[TopQuark]

I do know the difference, thank you. Please reread the post -— you must’ve missed the point it makes.

[microgood]

And how does that change the point being made?

Your post made it sound like Microsoft was making more profit than Exxon, but was not being targeted as opposed to making less than half the profit of Exxon and not being targeted.

[TopQuark]

It is incorrect to say that MSFT made less than half the profit of XOM. One does not compare absolute numbers in finance: think of the profits of your local mom-and-pop grocery store vs. profits of IBM, say.

XOM's profit is about 19.5% of assets, MSFT's is 18.7% of assets. The two companies have the same profits (when adjusted for size).

Our elected, anti-capitalist and anti-American leaders are fascinated by large numbers. They hoped that people will use your logic and get upset about the many billions in profit of XOM. They know that most people do not know how to count money and, given the prevalent anti-capitalist sentiment in the country, will support their attempted persecution of xOM shareholders --- retirees, widows and orphans for the most part.

You should be more watchful in these matters. The point was

[microgood]

Our elected, anti-capitalist and anti-American leaders are fascinated by large numbers. They hoped that people will use your logic and get upset about the many billions in profit of XOM.

What logic? I am not saying I agree with any of this, I was just pointing out the difference between the Exxon/Microsoft numbers. I do not even believe in corporate taxes at all since it is just an tax on the consumers anyway.

The only time I think it makes any sense at all to tax corporations are for sales overseas where they cannot tax them except at the source.