Microsoft financials buoyed by gaming, office software

The company reports record second-quarter revenue, though year-on-year quarterly growth was more moderate

Microsoft tallied US$19.95 billion in revenue for the quarter ending Dec. 31, a record second-quarter high for the company, it said Thursday.

However, revenue growth compared to the same quarter a year ago was moderate, either 5 percent or 15 percent, depending on how the numbers from a year ago are counted.

Microsoft had added on $1.71 billion in deferred revenue reflecting the pre-order sales of Windows 7 made available in October 2009 in its second-quarter results last year. When this deferred revenue is factored in, second quarter growth rates for revenue is 5 percent. Without this figure factored in, the growth rate was 15 percent.

The company also rang up $6.63 billion in net income for its second quarter of fiscal 2011. Diluted earnings per share were $0.77 per share, another second-quarter record high.

The company's gaming and business sales led the growth, according to the company.

Revenue from Microsoft's Entertainment and Devices Division, boosted by the success of the Kinect sensor and associated Xbox 360 consoles, grew by 55 percent from a year ago. The company noted that 8 million units of Kinect were sold within 60 days of its launch.

Revenue from the Microsoft Business Division revenue grew 24 percent, fueled by the steady demand of Office 2010, released last June. "Office had a huge quarter, exceeding everyone's expectations" said Kevin Turner, Microsoft chief operating officer, in a statement.

Microsoft also announced that has now sold over 300 million Windows 7 and that the Internet Explorer 9 beta has been downloaded over 20 million times.

In this quarter, which ended December 31, bought back $5 billion in stock and declared $1.3 billion in dividends.

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Joab Jackson

IDG News Service
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