Microsoft quarter shows continued growth

Microsoft fools analysts and reports better-than-expected quarterly revenue

Microsoft kicked off its first quarter of fiscal 2012 with solid growth, reporting a seven percent increase in revenue, compared to a year ago, and a six percent increase in net income.

Overall, Microsoft reported first-quarter revenue of US$17.37 billion, beating the consensus estimate from financial analysts of $17.24 billion, according to Thompson Reuters. Net income for the quarter ending Sept. 30 was $5.74 billion, or $0.68 per share, in line with analysts' consensus estimate.

As in quarters past, business sales dominated the growth for the company.

The Microsoft Business Division, which oversees Microsoft Office, reported $5.62 billion in revenue, an 8 percent increase from the prior year's first quarter, which itself benefitted from the release of Microsoft Office 2010.

"We had another strong quarter for Office, SharePoint, Exchange, and Lync, and saw growing demand for our public and private cloud services including Office 365, Dynamics CRM Online, and Windows Azure," said Kevin Turner, chief operating officer at Microsoft, in a statement.

Sales of Microsoft's enterprise support server software -- including Lync, SharePoint, and Exchange -- enjoyed double-digit growth, according to the company. Revenue from the company's Dynamics customer business grew 17 percent. For the back office, the Server and Tools Division generated $4.25 billion in revenue during the quarter, a 10 percent increase year on year.

Sales of Microsoft's flagship product, Windows, grew as well, although less spectacularly. The Windows and Windows Live Division revenue was $4.87 billion for the period, a 2 percent increase.

Starting next quarter, Microsoft will include financial results of Skype, whose acquisition it completed earlier this month. Because of this successful quarter, and the Skype acquisition, Microsoft increased its expectations for full fiscal 2012 revenue, from $28.6 billion to $29.2 billion.

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Joab Jackson

IDG News Service
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