Microsoft revenues tumble

Vendor reports 17 per cent income decline, 29 per cent fall on net profits
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Microsoft has posted results for its fourth quarter, which ended on June 30th. Overall quarterly revenue fell 17 per cent to $13.1 billion, while net income declined by 29 per cent to take $3.05 billion.

“Our business continued to be negatively impacted by weakness in the global PC and server markets,” said Microsoft’s CFO Chris Liddell. “In light of that environment, it was an excellent achievement to deliver over $750 million of operational savings compared to the prior year quarter.”

Microsoft is keen to point out that a number of factors reduced its financial results. These include research and development expenses related to Windows 7, which has now reached its milestone; and the company chose to defer $276 million worth of revenue related to the Windows 7 Upgrade Programme.

In addition, the vendor incurred losses of around $350 million due to legal and severance charges, and impairments to investments.

“While economic conditions presented challenges this year, we maintained our focus on delivering customer satisfaction and providing solutions to our customers to save money,” said Microsoft’s COO Kevin Turner. “I am very excited by the wave of product and services innovations being delivered in this next fiscal year.”

For the fiscal year ending on June 30th, revenue fell three per cent to $58.44 billion with a net profit of $14.57 billion, although interestingly Microsoft has provided projected operating expenses of $26.6 billion for the year ending on June 30th 2010, which raises the possibility of a strong next year for the software giant.

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