Microsoft Q3 earnings and revenue up, as all divisions make gains

In the wake of dismal PC sales reports from market researchers, Microsoft shows that Windows sales increased

Microsoft increased revenue across all its divisions in its third fiscal quarter, achieving an almost 20 percent revenue increase year on year.

For the quarter ended March 31, 2013, Microsoft generated revenue of US$20.5 billion, up 18 percent compared with the same quarter of 2012, the company said Thursday.

Net income came in at $6.06 billion, or $0.72 per share, compared with $5.1 billion, or $0.60 per share, in 2012's third quarter.

On a pro forma basis, factoring in certain one-time items, including net revenue recognition for Windows and Office upgrade offers and pre-sales, as well as the European Commission fine, revenue was $18.8 billion and earnings per share were $0.65.

The Business Division, which includes Office, increased revenue 8 percent to $6.32 billion. Adjusted for the revenue recognition of the upgrade offer and pre-sales, revenue grew 5 percent.

Microsoft launched the new version of the Office desktop productivity application suite at the end of January, introducing for the first time the option to license the product as an annual subscription. It remains to be seen whether that model will catch on with consumers accustomed to paying for Office once and getting a "perpetual" license for it.

The Server & Tools business racked up $5.04 billion in revenue, up 11 percent, helped by strong sales of SQL Server and System Center.

The Windows Division brought in revenue of $5.7 billion, up 23 percent, but adjusting for the revenue recognition related to the upgrade offer, the revenue growth was flat. This division also includes the Surface tablets.

Revenue shot up 18 percent to $832 million at the Online Services Division, spurred by a 22 percent increase in online advertising revenue.

The Entertainment and Devices Division had revenue of $2.53 billion, up 56 percent, but when adjusted for the revenue recognition related to a video game deferral, revenue rose 33 percent.

CFO Peter Klein said in a statement that the company's "diverse business continues to deliver solid financial results." Microsoft also announced that Klein will leave the company at the end of the fiscal year and that a replacement will be named in the coming weeks.

The earnings report comes about a week after IDC reported that global PC shipments plunged almost 14 percent year on year in the first quarter, its biggest quarterly decline ever, blaming the disaster in part on "a weak reception for Windows 8."

Juan Carlos Perez covers enterprise communication/collaboration suites, operating systems, browsers and general technology breaking news for The IDG News Service. Follow Juan on Twitter at @JuanCPerezIDG.

Join the Good Gear Guide newsletter!

Error: Please check your email address.

Tags business issuesapplicationsMicrosoftsoftwarefinancial resultsoperating systems

Our Back to Business guide highlights the best products for you to boost your productivity at home, on the road, at the office, or in the classroom.

Keep up with the latest tech news, reviews and previews by subscribing to the Good Gear Guide newsletter.

Juan Carlos Perez

IDG News Service
Show Comments

Most Popular Reviews

Latest News Articles

Resources

PCW Evaluation Team

Azadeh Williams

HP OfficeJet Pro 8730

A smarter way to print for busy small business owners, combining speedy printing with scanning and copying, making it easier to produce high quality documents and images at a touch of a button.

Andrew Grant

HP OfficeJet Pro 8730

I've had a multifunction printer in the office going on 10 years now. It was a neat bit of kit back in the day -- print, copy, scan, fax -- when printing over WiFi felt a bit like magic. It’s seen better days though and an upgrade’s well overdue. This HP OfficeJet Pro 8730 looks like it ticks all the same boxes: print, copy, scan, and fax. (Really? Does anyone fax anything any more? I guess it's good to know the facility’s there, just in case.) Printing over WiFi is more-or- less standard these days.

Ed Dawson

HP OfficeJet Pro 8730

As a freelance writer who is always on the go, I like my technology to be both efficient and effective so I can do my job well. The HP OfficeJet Pro 8730 Inkjet Printer ticks all the boxes in terms of form factor, performance and user interface.

Michael Hargreaves

Windows 10 for Business / Dell XPS 13

I’d happily recommend this touchscreen laptop and Windows 10 as a great way to get serious work done at a desk or on the road.

Aysha Strobbe

Windows 10 / HP Spectre x360

Ultimately, I think the Windows 10 environment is excellent for me as it caters for so many different uses. The inclusion of the Xbox app is also great for when you need some downtime too!

Mark Escubio

Windows 10 / Lenovo Yoga 910

For me, the Xbox Play Anywhere is a great new feature as it allows you to play your current Xbox games with higher resolutions and better graphics without forking out extra cash for another copy. Although available titles are still scarce, but I’m sure it will grow in time.

Featured Content

Latest Jobs

Don’t have an account? Sign up here

Don't have an account? Sign up now

Forgot password?