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Microsoft Corp. on Tuesday reported an 8 percent rise in revenue to $7.84 billion for the quarter ended March 31, 2003, over the $7.25 billion in revenue posted for the same year-ago period.
Revenue growth was driven primarily by unearned revenue from strong multi-year licensing in prior periods, but was offset by a 42 percent fall in revenue from its Home and Entertainment division, which includes the Xbox video game system; PC games; consumer software and hardware; and its TV platform, the company said in a statement released Tuesday afternoon.
Operating income grew 13 percent to $3.72 billion over the March quarter from the $3.3 billion reported in the prior year. Net income for the quarter came in slightly higher at $2.79 billion in the period from $2.74 billion the previous year, with diluted earnings a share of $0.26 in the March quarter.
John Connors, Microsofts chief financial officer, said in a statement that the environment remains tough, cautioning that there is “obviously a great deal of economic uncertainty ahead.” This mirrors the sober picture he painted of the global economy in January.
Microsoft management also said it expects revenue for the quarter to end-June to be in the range of $7.8 billion to $7.9 billion, with operating income expected of between $3.1 billion and $3.2 billion and diluted earnings per share of either $0.23 or $0.24.
For the full fiscal year to end-June, revenue of between $33.1 billion and $33.8 billion is expected, with operating income of $14.8 billion to $15.1 billion and diluted earnings per share of $1.04 and $1.06.
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Connors said that Microsofts ongoing investment in research and development has resulted in a broad product pipeline, including upcoming releases of Windows Server 2003, Visual Studio .Net 2003, Exchange 2003 and Office 2003.
In a product group breakdown, Microsoft said revenue from its Information Worker division, which includes Office, Visio and project, was up 9 percent compared to the same period last year, driven by customer demand for Office XP.
Also during the quarter, the company announced the broad availability of the second beta for Office 2003.
Revenue from the server platform grew 21 percent compared to the third quarter of last year, as demand continued for products including Microsoft Exchange, Microsoft SQL Server 2000 and the Windows 2000 Server family of products.
Microsoft Business Solutions posted year-over-year revenue growth of 96 percent, benefiting from the inclusion of revenues from Navision, acquired last July.
During the third quarter, Microsoft Business Solutions released the Microsoft Customer Relationship Management (CRM) product.
“At the end of the quarter, we already had over 1,000 authorized partners and more than 150 ISVs for Microsoft CRM,” Doug Burgum, the president of Microsoft Business Solutions, said in a statement.
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