Microsoft cuts revenue and profits

Microsoft has just announced its financial results for the last quarter of the fiscal year. The period, which runs from April to June 2013, has resulted in some revenues of 19,900 million dollars and 4,970 million dollars in profits Figures that remain to be below what was obtained in the previous quarter and which are partly explained by various adjustments and the recognition of previous expenses.

Revenues of 19,900 million dollars represent, yes, an increase of 10% compared to the same quarter last year. It may seem significant, but at the time Microsoft was facing a payment of 6.$200 million related to the acquisition of aQuantive in 2007. Revenue and earnings, as well as earnings per share of $0.59, are thus below expectationsof a good part of the analysts.

Differences from expectations could be partly explained because Microsoft has had to face $900 million in spending this quarter related to Surface RT inventory adjustmentsThe Microsoft tablet with Windows RT was not having good sales and the adjustments would be related to the promotions for various sectors and the reduction in its price until reaching the 329 euros it costs today.

Windows is the most affected division

In her statements, Amy Hood, CFO of Microsoft, acknowledges that the results have been affected by the drop in the PC market. The Windows division, without going any further, has seen its revenues drop by more than one billion compared to the previous quarter, down to 4.411 million current dollars. The blow to the division's profits is even greater, falling to 1,099 million dollars in this last quarter of the year.

The rest of the divisions ended the year better, with Servers and Tools raising its revenues to 5,502 million, representing a profit of 2.325 million dollars. A similar fate occurs with the Business division, which increases revenue by almost 1,000 million compared to the previous quarter. The online services division is another of those that manages to maintain itself although leaving some losses along the way.

There remains the Entertainment and Devices division, where things have not turned out as well as in the previous quarter. The department in charge of Xbox and Surface has returned to a loss of 110 million and a reduction in revenue. Both could be explained by both the Surface and the next change in the console generation with the arrival of Xbox One.

Microsoft's year ends positive

At the end of the year, the results are positive for Microsoft. The company has managed to improve its annual numbers, with revenues of 77,849 million and benefits of 26,764 million dollars. Both above $73 billion and $21 billion for the previous twelve months ending June 2012.

By divisions, all have improved their numbers to a greater or lesser extent, except the Windows division which, even having increased its revenues to 19 billion, has seen its profits drop by 2 billion to 9,504 millions of dollars. Apart from the drop in PC sales, it would be nice to know the figures for Windows 8 in the market, but this time Microsoft has not yet commented on the number of licenses sold so far.

Despite the latter, the end result is a good year for Microsoft The figures presented today will also be the latest before of the internal reorganization orchestrated by Steve Ballmer. From now on, a new year begins and we will be able to see how successful the decisions of the CEO of the company have been.

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