Microsoft reported a 6 percent boost in revenue for its fiscal third quarter of 2012, amidst a dip in net income and a poor showing for its Xbox business.
announced quarterly revenue of $17.41 billion for the quarter ended March 31,
2012, a 6 percent increase from the prior year period.
net income slipped 2.4 percent for the quarter, as the same quarter in 2011
enjoyed the boost of a tax settlement with the U.S. Internal Revenue Service
that raised profits. Net income for the quarter was $5.11 billion, compared
with $5.23 billion in the prior-year period.
driving toward exciting launches across the entire company, while delivering strong
financial results," said Steve Ballmer, Microsoft's CEO, in a statement.
"With the upcoming release of new Windows 8 PCs and tablets, the next
version of Office, and a wide array of products and services for the enterprise
and consumers, we will be delivering exceptional value to all our customers in
the year ahead."
Server & Tools business posted $4.57 billion in third-quarter revenue, a 14
percent increase from the prior-year period, driven by double-digit revenue
growth in SQL Server and more than 20 percent growth in System Center revenue.
Microsoft Business Division reported $5.81 billion in third-quarter revenue, a
9 percent increase from the prior-year period, reflecting the continued
strength of Office 2010 with businesses and consumers. Dynamics posted an 11
percent revenue increase from the prior-year period, with Dynamics CRM revenue
growing more than 30 percent.
started 2012 the way it ended 2011, with Server and Tools and Business Division
businesses accelerating, and Windows Division recording another quarter of
incremental revenue growth from a year ago," said Allan Krans, an analyst
with Technology Business Research (TBR), in a report on the software giant's
fiscal Q3 2012 earnings. "Average PC shipment declines through the latter
half of 2011 and beginning of 2012, coupled with Windows 7 peaking in
deployments, continue to hinder consistent performance from the Windows
business. Microsoft's Servers and Tools and Business Divisions recorded the
highest yearly growth during the quarter, at 14.1 percent and 9.1 percent,
respectively. Business, Windows and Server and Tools Divisions were once again
the largest contributors to Microsoft's $17.4 billion in revenue during 1Q12.
Microsoft's ability to refresh core products to cater to customer needs in
cloud and flexible IT will determine the growth trajectory for these core
businesses moving forward."
Microsoft's Windows and Windows Live Division posted revenue of $4.62 billion,
a 4 percent increase from the prior-year period. Strong Windows 7 adoption
continued, with enterprise desktops on Windows 7 now up to 40 percent
worldwide, the company said.
Windows business is not in jeopardy of fading into the sunset in 2012, as a
broad install-base and the continued use of Windows 7 on PCs in businesses
worldwide continue to make Windows one of the most profitable businesses for
the company (63.8 percent operating margin in 1Q12, behind only the Business
Division at 64.8 percent operating margin). With that said, the successful
launch of Windows 8 across mobile devices and tablets in 2012 will ensure
sustained growth in both the consumer and enterprise markets."
saw strong demand for our business desktop and infrastructure offerings,"
said Peter Klein, chief financial officer at Microsoft, in a statement.
"Solid revenue growth and continued cost discipline drove double-digit
operating income growth."
Darryl K. Taft covers the development tools and developer-related issues beat from his office in Baltimore. He has more than 10 years of experience in the business and is always looking for the next scoop. Taft is a member of the Association for Computing Machinery (ACM) and was named 'one of the most active middleware reporters in the world' by The Middleware Co. He also has his own card in the 'Who's Who in Enterprise Java' deck.