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Microsoft releases Earnings Report, First Quarter sees declines

Microsoft FY13 Q1 Earnings Report released

Microsoft has announced it's first quarterly report for the 2013 Fiscal Year. The company reported a quarterly revenue of $16.01 billion for the quarter ending September 30, 2012. This is down 8% from a year ago and likely due to consumers holding off on computer purchases until Windows 8 hits the shelves.

Other key numbers from the FY13 Q1 Earnings report has Operating Income at $5.31 billion and Diluted Earnings Per Share at $.53 per share. Both Income and Diluted EPS were down 26% and 22% respectively from last year.

The Entertainment and Devices Division that is responsible for the Xbox and Windows Phones posted revenue of $1.95 billion. This represents a 1% decrease from the previous year. On the positive, Xbox consoles continue to dominate with a 49% market share and the newly acquired Skype continues it's positive growth with over 280 million users.

While the Earnings Report had declines, Microsoft CEO Steve Ballmer remains positive with Windows 8 and Windows Phone 8 just around the corner.

“The launch of Windows 8 is the beginning of a new era at Microsoft. Investments we’ve made over a number of years are now coming together to create a future of exceptional devices and services, with tremendous opportunity for our customers, developers, and partners.”

It will be interesting to see how the release of Windows 8 and the new Windows Phone 8 devices will effect the second quarter earnings for Microsoft.  You can find all the Earnings Report numbers at the source link below and we'll have a more detailed analysis up shortly.

Source: Microsoft

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Reader comments

Microsoft releases Earnings Report, First Quarter sees declines

29 Comments

As far as Xbox goes, those are REALLY good numbers.  This is very late in the life-cycle for the current gen gaming consoles and Microsoft's Xbox continues to take a commanding lead.  

Not bad at all considering they're on the cusp of releasing a major OS upgrade.

This is like the calm before a storm and I'm stoked to see their financial results 3 months from now.

What bothers me is any official statement about MS and it's excitement over the future is about Windows 8, and WP8 is almost always left off. Unless it is specifically about WP8, it is still does not appear appear to be in the forefront of Ballmer and the other Bigwigs minds. It should be a part of every press release, every conversation about the future, and promoted every chance there is.

Worries me that it is not.

Ya lets see how the next 2 quarters go:
 
1. Surface RT
2. Surface PRO
3. Windows 8
4. Windows Server 2013 (or is it 2012 i dont remember)
5. Windows phone 8
6. Office 2013
7. All other new OEM products that they make money on...
8. Surface phone ???????
 
Im gonna go with earth shattering numbers on the next few quarters...

Well, if we're gonna do that we have to say SQL Server 2012 was released several months ago and would be included in these numbers.

Most companies have to settle for smaller profits in light of the slow recovery.  Compound that with a major releases this bound to be the case.  Short of a global meltdown, I'm expecting much better quarters ahead.

+1 and Google-

Shareholder Letter from Steve Ballmer: For fiscal year 2012, revenue grew to a record $73.7 billion. We also maintained strong cost discipline resulting in cash flow from operations of $31.6 billion, an increase of 17 percent from the prior year. In addition, we returned $10.7 billion to shareholders through stock buybacks and dividends.

We delivered these results while preparing a pipeline of new and updated products that will launch in the year ahead. To best understand what we are about to deliver and what we're building toward, it's important to recognize a fundamental shift underway in our business and the areas of technology that we believe will drive the greatest opportunity in the future.

This bit wasn't reported here:

"Microsoft deferred a total of $1.36bn of revenue, which it will regain in the following quarter."

That's pretty big news as next quarter will get the $1.36 billion on top of what's expected to be a monstrous quarter.

Ding ding ding... and here we have a winner. Exactly, nothing actually happened - Microsoft just had to put some of their profits in a jar until next month :)

The biggest decline will be Windows 8 for desktops and non-touch devices. Windows Phone will do great and tablets might do well also but we will have to wait and see. I have a funny feeling that Windows 8 will be a big flop.

Given all new hardware will ship with Windows 8 unless the user otherwise specifies, the likelihood is it won't flop from a sales perspective.  As far as usability goes, I'm noticing in my own professional life that a lot of IT folks that were complaining change their tune when they get a Windows 8 device in their hands.  Not to mention enterprises are already intrigued by things like Windows To Go and the VDI enhancements.  I give people the benefit of the doubt when it comes to learning new things - I sincerely doubt that it'll be a flop in any way, and with new hardware designs coming with the OS that takes advantage of it's strong points that shouldn't be much of an issue either.

MS has so many top of the line products , that even if WP/surface doesn't take off by next year , isn't going to affect them much.

But if iphone/ipad starts to show drop in sales( which will ultimately happen ) , what will apple do.. ??? Where will they go.. What will they do ??? Mac os is nothing compared to any of the products of MS

Am I stupid ?? I hope not..