Microsoft revenue up, but profits down for Q4
- 21 July, 2006 22:00
Strong sales of the Xbox 360 and SQL Server 2005 helped Microsoft end its fiscal year on a bit of a high note, though income was down due to expenses and legal charges.
For its fiscal fourth quarter, which ended June 30, Microsoft reported revenue of US$11.8 billion (NZ$18.97 billion), which beat Wall Street expectations of $11.6 billion and was a 16% increase over the year-ago figure.
However, Microsoft's net income for the quarter, which ended June 30, was down 24% over the previous year. The company reported net income of $2.83 billion and earnings per share (EPS) of $0.28, which included legal charges. Excluding those charges, Microsoft earned $0.31 per share for the quarter, slightly higher than estimates by analysts polled by Thomson Financial, which expected Microsoft to earn $0.30 per share for the quarter. For the same quarter last year, net income was $3.7 billion, or $0.34 per share.
Microsoft also reported results for its 2006 fiscal year. The company reported revenue of $44.28 billion for the year, an 11% increase over the prior year. Net income was $12.6 billion, or $1.27 per share, a penny over estimates by Thomson Financial analysts, which expected the company to earn $1.26 per share for the year.
In addition to reporting financial results, Microsoft also authorised a significant stock repurchase plan. The company said it will repurchase $20 billion in stock by August 17, and an additional $20 billion in an ongoing share repurchase programme that expires on June 20, 2011. The company also says it completed a previously announced $30 billion stock repurchase programme.
Looking ahead to 2007, Microsoft raised its guidance for both revenue and EPS. Previously, the company said it expected revenue in the range of $49.5 billion to $50.5 billion for 2007, but said Thursday it expects revenue to be between $49.7 billion to $50.7 billion. Microsoft anticipates EPS for 2007 will be in the range of $1.43 to $1.47, higher than the range of $1.36 to $1.41 it previously expected.