Forums - Microsoft Discussion - MICROSOFT QTR 1 (FY'14): $5.24bn profit on $18.53bn rev. 360: 1.2m. Results crush expectations...Shares jump 6% in after hours.

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HEADLINE:

Q1 FY2014 RESULTS
360 shipments:     1.2m  (Total 79.40m - passed 80.0m Mid October)   
Financials: $18.53bn Revenue and $5.24bn Profit for the quarter.

SEE POST 2 IN THREAD FOR DETAIL
NEWS COVERAGE:

Microsoft profits surge 17%, beating expectations

Microsoft reported better than expected earnings of $5.2bn (£3.2bn).

Profits at the technology giant were up 17% from the same period last year.

"Our devices and services transformation is progressing," said boss Steve Ballmer in a statement. He added that Microsoft is launching a "wide range" of new products in the coming quarter.

The report shed no light on who is to replace Mr Ballmer, who announced plans to retire within the next year.

The company has released several new products this quarter, including an update to Windows 8, and recently bought the mobile phone unit of struggling Finnish giant Nokia.

Shares rose 6% in after hours trading on the strong results.



Microsoft Crushes FQ1 Expectations With Revenue of $18.5B, EPS Of $0.62, $400M In Surface Top Line

Microsoft reported its fiscal first quarter results today, with revenue of $18.53 billion and earnings per share of $0.62. Analysts had expected the first quarter of Microsoft’s fiscal 2014 to generated revenue of $17.8 billion and earnings per share of $0.54.

Microsoft’s net income was $5.24 billion, and its operating income was $6.33 billion. Microsoft ended the quarter with just over $80 billion in cash, and equivalents. It remains exceptionally wealthy. Though, keep in mind that most of that cash is overseas.

In its most recent sequential quarter, Microsoft reported an earnings miss, with revenue of $19.9 billion, far under the expected $20.74 billion figure. Also, in its most recent quarter, Microsoft recorded a $900 million charge relating to its Surface tablet project. It also reported that Surface revenue for the concluding fiscal year of 2013 was $853 million.

Surface revenue for the quarter was $400 million, with Microsoft reporting that that figure represents “sequential growth in revenue and units sold over the prior quarter.” That figure is almost half of its former tally for several quarters, including launch. Microsoft will likely beat that figure in the current quarter, as it has several new Surface devices racing to market.

That decent Surface figure is contrasted in the quarter by slipping Windows OEM revenue. According to Microsoft, revenue derived from selling Windows to its OEM partners fell 7% on a year over year basis. This is a reflection of the sickness in the PC market. Microsoft tried to bully pulpit the decline by stating that “Windows Pro revenue grew for the second consecutive quarter.” Please.

Overall, revenue from the Devices and Consumer division was up 4% year over year. Top line from so-called ‘Commercial’ sources was up 10% year over year, to $11.20 billion. I can’t imagine a better illustration of Microsoft’s current health than that: Enterprise, strong – Consumer, middling.

Microsoft is up 5% in after-hours trading. TechCrunch is speaking with Microsoft regarding its quarterly performance shortly, and will have more context following that call.

In its fiscal second quarter, Microsoft will begin to sell the Xbox One, Surface 2, and Surface Pro 2, along with a slew of new Lumia handsets. Microsoft doesn’t own that part of Nokia yet, but I haven’t met a person who thinks that the deal will fail, so we can unite the two. This means that its fiscal second quarter of 2014 will be by far Microsoft’s largest in terms of its device strategy. The numbers reported in January will detail success, or explain a failure of strategy.

 

Microsoft First-Quarter Sales, Profit Exceed Analysts’ Estimates

By Dina Bass - Oct 24, 2013 9:15 PM GMT+0100

Microsoft Corp. (MSFT) reported first-quarter sales and profit that exceeded analysts’ projections as the company, which is looking for a replacement for Chief Executive Officer Steve Ballmer, relied on corporate software demand to make up for weak consumer personal-computer purchases.

Net income in the period that ended Sept. 30 rose to $5.24 billion, or 62 cents a share, from $4.47 billion, or 53 cents, a year earlier, Microsoft said today in a statement. Sales climbed 16 percent to $18.5 billion. Analysts on average had predicted profit of 54 cents a share on $17.8 billion in revenue, according to data compiled by Bloomberg.

The world’s largest software maker is undergoing unprecedented changes, conducting its first-ever CEO search and starting a major organizational overhaul aimed at bolstering sales by focusing on devices and services. Demand for Microsoft’s Office productivity software has helped compensate for declining consumer purchases of PCs running Windows, and the company has been cutting costs to shore up profit.

“Business has been driving the train,” said Colin Gillis, an analyst at BGC Partners LP in New York, who recommends holding the shares. “Most people are really looking through the quarter to the new CEO.”

Microsoft shares rose as high as $36.20 in extended trading following the report. They fell less than 1 percent to $33.72 at the close in New York. The stock lost 3.7 percent in the quarter, compared with a 4.7 percent increase in the Standard & Poor’s 500 Index.

Future Revenue

Unearned revenue, which comes from sales of multiyear deals that will be recognized in the future, was $20.2 billion for the quarter, compared with the $21.1 billion average analyst projection, according to data compiled by Bloomberg.

The software maker’s sales growth has stalled as the PC market has contracted, hurt by a transition to mobile devices for surfing the Internet. Worldwide PC shipments fell 8.6 percent last quarter, researcher Gartner Inc. said earlier this month, amid lackluster demand from students returning to school.

Microsoft’s efforts in mobile phones and tablets have produced little progress in what is already an uphill climb to keep Apple (AAPL) Inc.’s iOS and Google Inc.’s Android operating system from shutting out Windows. Three years after rejiggering its phone software to be more appealing to consumers, Redmond, Washington-based Microsoft still has only 3.7 percent share in smartphone operating systems, according to IDC. Its share in tablets in the second quarter came in at 4.5 percent for all versions of Windows, IDC said.

Surface Tablet

In July, the company’s profit in the fiscal fourth quarter missed projections by the the biggest margin in at least 10 years. Results also were hurt by a $900 million writedown of inventory of the Surface tablet, Microsoft’s own foray into mobile-computing hardware. The company cut prices for the devices, which first went on sale a year ago, to clear inventory ahead of the introduction of updated models this week.

A week before the earnings miss, Ballmer unveiled Microsoft’s biggest management shuffle in more than a decade, a bid to align the company around hardware and Internet-based services and an attempt to halt the slide of Windows.

Then, in August, the company said that Ballmer, who took over as CEO from co-founder Bill Gates in 2000, will step down from that role within a year. People with knowledge of the matter said earlier this month that the board is aiming to have a successor in place by the end of 2013.

Nokia Deal

To bolster its efforts in mobile, Microsoft reached an agreement in September to acquire Nokia Oyj (NOK1V)’s handset unit for $7.2 billion. Windows Phone’s third-place ranking in smartphone operating systems in the second quarter compared with 79 percent market share for Google’s Android and 13 percent for Apple’s iOS, IDC said in August.

The period that ended in September was a tough quarter for several large technology companies, with International Business Machines Corp. posting its sixth straight quarterly sales decline. Storage-equipment maker EMC Corp. said sales fell short because customers delayed contracts and U.S. government clients stopped spending.

Other rivals benefited from strength in areas like mobile and Internet-based cloud software -- underscoring Microsoft’s reasons for focusing more on these businesses. Google Inc. reported sales that topped analysts’ estimates, owing to strength in mobile advertising and video. VMware Inc. (VMW), which makes software that lets companies combine multiple applications on a single computer, as well as cloud software, exceeded profit estimates on a 14 percent jump in sales.

Following the July business reorganization, Microsoft altered how it reports revenue from different units, opting for a structure that splits sales into a total of five segments and provides operating income for two larger categories: one for commercial business, such as Windows and Office corporate software licenses and services; and the other for devices and consumer products, including Xbox, Surface, consumer Windows sales and its Bing search engine.

To contact the reporter on this story: Dina Bass in Seattle at dbass2@bloomberg.net

To contact the editor responsible for this story: Pui-Wing Tam at ptam13@bloomberg.net



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I'm not really here!

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Link: Shipment History Since 1995

The investment world will be slightly amused as slowing rrevenue growth and earnings brought down by nokia, until a year or so, when they start bringing nokia back to shape.  



Jesus, the brits don't do the English language any justice. Net revenue is now called turnover? Lol

dallas said:

The investment world will be slightly amused as slowing rrevenue growth and earnings brought down by nokia, until a year or so, when they start bringing nokia back to shape.  


Except of course that they dont take over Nokia devices until next year.

Yet again your failure of knowledge on anything MS rears its head.

 



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dallas said:
Jesus, the brits don't do the English language any justice. Net revenue is now called turnover? Lol


give it a rest will you.  I shall amend.

if all you are going to do is cause trouble here. leave.



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kowenicki said:
dallas said:
Jesus, the brits don't do the English language any justice. Net revenue is now called turnover? Lol


give it a rest will you.  I shall amend.

if all you are going to do is cause trouble here. leave.

 

You need that stiff upper lip, cheerio



Thank god they put in an ignore button here!

Find is strange 1st Party SW is in other area to everything else Xbox related.

Seece said:
Thank god they put in an ignore button here!

Find is strange 1st Party SW is in other area to everything else Xbox related.


huh?

as for the other point..

its more odd that 2nd and 3rd party software is in devices surely.  I guess that isnt THEIR software?  Their own software is in other (not devices)



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kowenicki said:
Seece said:
Thank god they put in an ignore button here!

Find is strange 1st Party SW is in other area to everything else Xbox related.


huh?

as for the other point..

its more odd that 2nd and 3rd party software is in devices surely.  I guess that isnt THEIR software?  Their own software is in other (not devices)

Is it just me then?? How did that appear .... I did wonder why there wasn't a thread on it.

I guess that makes some sense, would have loved an all Xbox division though.