Microsoft today announced third-quarter revenue, operating income and diluted earnings per share of $14.45 billion, $4.41
billion and $0.47, respectively -- and that's after the EU's wrist slap of $1.4 billion (or 15 cents a share), as reported today.
Server and Tools revenue experienced growth of 18%, the 23 quarter in which the unit experienced double-digit revenue growth. Microsoft also noted that its Entertainment and Devices revenue for the quarter grew 68% over third-quarter a year ago, most driven by sales of Xbox 360 consoles. Console sales alone surpassed $19 million during the quarter, up 74% from a year ago.
Microsoft is projecting another huge quarter for its fourth quarter, which ends June 30. The company expects revenue to
be in the range of $15.5 billion to $15.8 billion, with profits landing at $5.8 billion to $6.2 billion. For the full year, also ending June 30, it expects its revenue to land in the range of $66.9 billion to $68 billion with profits coming in at $26.7 billion to $27.4 billion. So far this year, Microsoft has spent almost 5.8 billion on R&D efforts.
The initial press release also notes that Microsoft $154 million in legal charges -- which is clearly nothing considering its nearly $5 billion in profit.
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Reports of Microsoft's "disappointing" quarter
It is interesting that so many reports on Microsoft's third-quarter make it sound as if the software giant tanked. In particular, headlines are noting that net income fell to $4.4 billion, or 47 cents per share, from $4.9 billion, or 50 cents per share a year earlier. Please note, the dip in profits is half a million dollars and the fee Microsoft paid to the EU resulted in a charge of $1.42 billion, or 15 cents per share. Analysts (according to Thomson Financial Network) expected 3Q earnings to be 44 cents per share (and it came it at 47 cents) and revenue of $14.5 billion (and it came it at $14.45 billion).