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Microsoft reports FY15 Q4 results, with $22.2 billion in revenue and loss of $2.1 billion

Microsoft has reported its earnings for its fourth fiscal quarter of 2015, for the time period ending on June 30. Overall, the company brought in a total of $22.2 billion in revenue. It also recorded an operating loss of $2.1 billion for the quarter.

The loss was due to Microsoft taking a $7.5 billion one-time charge to write down the acquisition of Nokia's Devices and Services division in 2014, along with two restructuring charges of $780 million and $160 million. Microsoft also announced plans earlier in July to lay off 7,800 of its employees by the end of June 2016, Microsoft said:

" Combined, these items totaled $8.4 billion or a $1.02 per share negative impact. Excluding this impact, operating income and EPS would have been $6.4 billion and $0.62, respectively."

Source: Microsoft (opens in new tab)

60 Comments
  • Ouch. One time charge though, so they will do fine. Surface and Xbox revenue is up, and Windows 10 is about to hit. They should have a nice Q3/4, especially if the rumored October SP4 launch pans out. Posted via the Windows Central App for Android
  • Service Pack 4 so soon? Wow!!! ;)
  • I know, right? I haven't yet been able to get used to shortening Surface Pro to SP for the same reason as you.
  • One can only hope. I've seen reports on Windows phone reaching 50% by 2015 so predictions in the tech world are things in stay away from. I do hope it all works out.
  • are you kidding?? windows phone reaching 50% by 2015....i dont see it rising up to 5% this year. Here in India people dont like WPs due to lack of features when compared to Android. Plus people had a trust on NOKIA hardware which Microsoft has ruined with Lumia 535 and even 640 to some extent. People experience laggy performance and touch response is just not up to the mark. Even my 520 gives much better smooth performance than 535. And Microsoft's decision to go with only 3 types of phones every year and lack of OEMs, the range of choices get very narrow which was wide open before MS acquired NOKIA. 
  • I said "I've read reports" I didn't state that it would reach 50%.
  • Link please. I'd like to see what sort of "report" would be so delusional
  • "people had trust on Nokia hardware which Microsoft ruined with the Lumia 535 and even 640 to some extent" Is that why the Lumia 535 has outsold every Nokia Lumia handset and is the top Windows Phone in that country? Ok
  • Bought a lumia 640xl yesterday and i was really impressed by it. Coming from a iphone and lumia 1520. I did have a lumia 735 for like a day but that phone was just completely rubbish. So slow and laggy and apps crashing all the time. But i wanted to give lowend lumias a nother try and im really impressed by the 640xl, so far..
  • Interesting.. I've found 640 to be surprisingly excellent phone overall. I've no experience of 535 though. Several OEMs have also promised to bring new phones, I'm guessing shortly after win10 for mobile launches.I don't see market share getting too high during this year, next year will be interesting nevertheless. MS promising to keep bringing new phones is also excellent news
  • The reason theyre going with 3 types of phones per year is because they want to get more OEMs on board. Microsoft started out as a software company, and is successful at it. They dont rely on their hardware sales anywhere near as much as software. Thats why they partner with OEMs to make the bulk of the hardware. Acquiring Nokia's phone division just turned off OEMs from making devices because there are so many Lumias on the market that they didnt have the chance to compete, hence the lack of OEM support. This cutback strategy Microsoft is going with is the best strategy they have left. If they can make good hardware to get OEMs interested in making something better, this is the key to gaining back their support. Theyve done it with the Surface line and have been fairly successful in that strategy. Now theyre hoping the same strategy will pay off for their new line of phones coming out.
  • What are you talking about? Lumia 640 is one of the best lowend phone, it don't have any problem like 535. It beats every low end nokia lumia. Btw, in India Lumia sales are up after Microsoft Lumia comes to market. In my city, I see 4 Lumia's out of 10 phones daily
  • I totally agree with you even i am a fan boy of wp. And ya i am also using 535 and i guess touch screen of 520 is better.
  • WP is already above 50%...in my house.  Sadly, I can only remember ever seeing one other windows phone (one!) in the wild. By the way, I love the 640.  Not a single complaint here.
  • 3 types of product line, not 3 models. Very different my friend. And thats only MS, not the other OEMs, which admittedly is not a wide choice :/
  • They'd be doing better if you bought a Windows Phone. Just saying.
  • Microsoft isn't some tiny Mom & Pop store on the block, it's a multi-billion corporation.
  • pull the plug on Windows Phone and balancesheet will look better :)
  • They just wrote it off. It's not on the balance sheet anymore. You must mean that the income statement will look better if the phone unit is generating more losses.
  • Windows Mobile (the operating system) and Nokia phone hardware (the one they have been downsizing from the insane initial 50,000 workers) are two different things. They haven't made any cuts to Windows Phone.
  • They wrote off the Nokia Phone division, not Windows Phone.
  • You mean a nice Q1/2. Their fiscal year ends in June. They are currently in the 1st quarter of 2016.
  • As expected given the Ballmerlopkia write-down.
  • Yea fine! With the coming future of Windows, the situation would be fine. Flagship products in their waitinglist too.. Let's hope for the best from them(Microsoft)
  • Better than fine. I believe that type of write-off can offset future profits for tax purposes. Not sure of the ratio or details.
  • LOL I love your business bable.Its like a game, I am gonna sit for hours wondering where the actual fact or logic is in your missive. Thanks for that.
  • Not a huge deal. The write down is an accounting tactic. Still a profitable corporation and doing well in many sectors that are important in the future.
  • This big loss is why Microsoft chose to write down the Nokia acquisition before Windows 10 came out. "bu... But... It's cutting off Windows Mobile at the knees before it comes out the gate!!!" No, but seeing headlines that Microsoft lost billions AFTER Windows 10 came out surely would cripple the entire Windows 10 story. Thankfully, Nadella has promised fewer gigantic purchases like this.
  • Thats because he has better long term strategies for Microsoft to succeed in the long run. That thick headed baboon Ballmer's ideas of strategies were to acquire big divisions of companies (ex: Nokia's devices division) and hope that they help Microsoft in the long run. He thinks from business standpoints, and nothing more. The Nokia deal was doing nothing but crippling Microsoft, and Ballmer didnt do a damn thing about it, which is why the write off impacted them so much at this point. Nadella is simply correcting Ballmer's f**kups so things are going to seem a little negative for a bit until things start to take place, hence all of the tech bloggers just eagerly jumping the gun with "windows phone is dead" or "nail in the coffin" headlines because theyre too impatient to get any official confirmation that it is done for, when it is clearly not.
  • Steve Ballmer was out of the door before the acquisition of Nokia's devices and services division was finalized (he signed the ink but it was months before they had the green light from the authorities) . So he couldn't have done anything about it. Be glad Steve Ballmer fought so hard to make this acquisition happen. It's what kept WP a float until now. If Nokia had gone bankrupt, had been bought by a competitor or would have switched to full android mode it would have been the end of WP. Satya did the right thing by cutting the division and streamlining the parts they could use in there own organization, yes its been an expensive move, but the only right move to safe there mobile platform.
  • I doubt Windows 10 will increase demand and them giving it away for free isn't going to help revenue, especially since no one uses their store. Most people buy hardware and expect good software to be part of that package, I've never met your average consumer who is excited for an updated. Xbox One is losing to the PS4, I don't think it'll ever regain that ground considering it's way down on power in the GPU department. Most people don't have a gaming PC or more than one system, so they'll go to the PS4 since third party games make up 90% and they'll look better on the PS4. It all comes down to this fall for that system really, can Halo 5 turn it around? I'm just not sure Halo has the pulling power any more, no one I know cares about it at this point. When it comes to Windows Phone... well they better have something good planned or I don't see it gaining much traction. Even then we're talking about 10% of the market max in the next 3+ years. It's not looking all that great for Microsoft, but they have the right people in charge now to turn it around, the last lot run Microsoft into the ground and these new guys are picking up the pieces. The goodf news for them though is, they have the monopoly in the PC market and I don't ever see that changing due to Apple's Mac prices.
  • I agree with you completely. Steve Ballmer, although a nice guy, was slightly arrogant and miopic.
  • they are giving windows 10 free and hoping people will spend money on marketplaces and services etc. I doubt how much that will work. Apple is very successful in doing this ... because apple users don't mind they have a huge user base in USA. but with windows i doubt. 
  • They are giving it it away for free on upgrades to existing devices. Oem's still pay a license fee as do enterprise customers. After the 1st year, it won't be free anymore. Can you point to to a single game that actually looks better in real game play? If you freeze and image and zoom in, you can see the slight differences. In live game play, you can't tell the difference.
  • A lack of gpu power will not keep the X1 from catching up with the ps4.  Does anyone actually know if the gap is narrowing?    What will allow the X1 to close the gap is: 1. Competitive pricing
    2. Compelling content
    3. Compelling features One console having a stronger gpu does not equal failure for the other. Besides, its not like its 2 to 1 stronger, its more like 15-20% and that is just looking at raw numbers, not taking anything else into account. Just look at the ps3 v 360 race, where the 360 had a huge lead, but then the numbers got very close as the years went on. Plus, is everyone forgetting that while the ps4 leads in sales, BOTH consoles continue to outsell the previous generation. Xbox is doing fine, they just need to keep executing as they have in the last year.
  • The actual difference in power is likely not even 15-20%, but more like 10%, despite the "50% more shader units" hype. And notice how all the "PS4 runs at higher res" argments all went away after the launch group of games, since now cross-platform games run just about identically? The diferences between the to are not even worth mentioning any more.
  • Are you kidding? General Electric just signed a contract to use Office 365 on all their employees. Just do some math. That's still an important place where the money is coming for Microsoft in the future, from large corporations.
  • GE using office 365??  In that case no small business should be running email in-house.  My company made the leap 3 years ago.
  • Youre living in 2006.  I cant see how PS4 gets past 50 million in the age where casual gaming has moved to phones and tablets.  It's just a game console and an average multimedia device. 
      You can state specs all you want, but the actual product on the screen doesn't support the difference on paper.  
  • The reason no one used the store is because it was a fairly new concept for windows at the time, and Microsoft did a bad job at telling people it was there. Plus all of the apps were half assed because devs didnt care, so that turned people off from the store. As long as Microsoft keeps marketing the "One store for every device" fact and gets more apps/programs available for it then people will become more attracted to it. As far as the graphics on consoles are concerned, I couldnt care less. I was one of those 90s kids that believed good gameplay was better than graphics anyday, but thats just me, and sadly all people really care about nowadays are graphics. At this point its hard telling whats going to happen with Windows Mobile. Right now its in its restructuring phase so things will seem a little negative for it, but if the new team at Microsoft pulls it off right I can see it gaining some decent traction.
  • My counterpoint would be: there's still no evidence that developers are flocking to develop universal apps for the Windows 10 store. I'm not even aware of any app launch partners for the  W10 rollout.
  • well, the stock took a dive. its 3% down
  • It's up 0.77%, actually.
  • That's at the time of closing. After hours, the stock is down 3.40%.
  • Sad day for Microsoft indeed, but I think it's much more valuable than Google and Apple combined. Lets hope HoloLens and Microsoft can have what people expect to be, a revolutionary technology that creates a new industry for powering the Internet of Things era.
  • Just bounce back! Right now is one of the highest rises in the market since Nadella leads the ship
  • Not surprised. It seems like they bought Nokia and didn't really have anything to show for it. No new innovations, no new noteworthy phones.. Nothing
  • Nokia was a massive liability to Microsoft. Sadly still is.
    Turned the page. Future is much brighter with MS engineers in charge!
  • You know what? In my really humble opinion, we are at such age where the marketers should be in charge and lead the engineers. I think MSFT is really lacking in this department, they are not good at selling their products. Just my HO
  • Is it a phone more profitable when you do your own devices or when someone else do it for u? Is all about that.
  • McLaren cancellation has something to do with this. After the Lumia 1020, many Windows users couldn't upgrade their phone since the 930 wasn't a 1020 upgrade, it had better CPU and more RAM but the camera tech was not as good as on the 1020. Let's hope those 940 and 940XL really meet customers expectations.
  • That was Ballmer's mistake that hurt Microsoft significantly. If Nadella wouldve been in charge before that acquisition was made things would be a lot different for windows phone, and probably in the good way. All the Nokia deal did was cripple Windows Phone. They just made pretty much the same low end devices, with the same design and hardware, and gave it a different price tag. Thats kinda like a fast food chain selling nothing but cheeseburgers, with the only difference being one has ketchup and the other doesnt.
  • Nokia devices was not bought to use or make money. It was bought to prevent it from being bought by any other (Android based) company which would have been a disaster as Nokia had 97% of market share in Windows Phone. The layoffs and write off were all planned well in advance. Nokia ran out of cash and basically was not able to buy parts for new phones anymore. They were living off of MSFT wallet anyway.
  • Agree with that, OEMs like Sony, HTC and Motorola are not making any money with Android. Moto was bought by Lenovo to try to obfuscate Moto's red numbers. HTC is always behind chinese OEMs and Sony is now thinking in the IoT as their only reason why they keep selling phones without profits. To be real, the only winners have been 3 companies:
    1) Apple 2) Samsung 3) Xiaomi About Lenovo, LG and Huawei have marketshare but I really doubt they make real profits, they should now worry about those wearables and see how can they make profits increase.
  • I'll probably eventually have to settle with a budget phone from Samsung but I'm putting it off because Moto G and Moto E are a better value. Microsoft's apps for Android and iOS look and work so well it almost makes you wonder why they should even bother with Windows mobile and phone hardware at all. 
  • MSFT better hope Win10 takes off, especially garner new customers for WinPhone10. The market really does need a 3rd big OS as an alternative to Android and iOS. 
  • The key to windows 10 mobile's success is how well windows 10 for desktops and tablets succeeds. Developers dont give a rats ass about windows phone because "there arent enough people using it", but they are interested in making apps for those on desktops and tablets because of the huge consumer base and the potential profit. Fortunately with Microsoft's universal app strategy, those apps created for desktops and tablets should work for phones as well, which would solve windows phone's "app gap" issue, and hopefully draw more consumers toward windows mobile.
  • Some folks would like a 3rd major mobile OS, but there's no evidence that the marketplace *needs* one, otherwise it would've reflected in sales.
  • MS still made more money, but stock went down after hours, for no reason whatsoever. the craziest thing ever. 
  • Don't worry about that. Too bad I didn't buy more MSFT shares in the opening.It's down only 1% now :)