updated 04:35 pm EDT, Thu October 20, 2011
Microsoft summer results shy on Windows and phone
Microsoft posted record results for the summer that were nonetheless muted. Its profit was up six percent from year to year but was enough to get it a new high of $17.37 billion in pure revenue, up seven percent, and a six percent hike in profit to $5.74 billion. Most of this came from the Business and Server groups, which grew eight and ten points each to make $5.62 billion and $4.25 billion each.
The company downplayed problems with its Windows and Windows Phone business. Its desktop Windows group's revenue grew just two percent, "in line with the PC market," Microsoft said. As it has for most of 2011, it also declined altogether to mention Windows Phone's performance, a sign that shipments likely hadn't improved from the spring. Its group, the Entertainment and Devices division, managed $1.96 billion based mostly on the Xbox 360 and Kinect.
Online services like Bing improved but still lost the company about $500 million, making just $625 million.
The performance is a turnaround from two consecutive quarters of Windows revenue dropping but contrasts sharply with Mac shipments, which grew 22 percent, according to IDC. Apple saw a drop in iPhone sales as buyers waited for the iPhone 4S, although at 17.07 million iPhones it's likely to have sold roughly ten times as many devices. Its revenue was 62 percent higher than Microsoft's, owing both to its much more hardware-oriented business but also its success in eating into Windows sales by diverting some to the iPad and MacBooks.