Filed under: Earnings reports, Microsoft (MSFT), Yahoo! (YHOO), Intel (INTC), International Business Machines (IBM)
Shares of Microsoft (NASDAQ: MSFT) fell in after-hours trading after the world’s largest software maker failed to wow investors.
Net income at the Redmond, Wash., company fell to $4.39 billion, or 47 cents a share, on flat revenue of $14.5 billion. Analysts had expected profit of 44 cents on revenue of $14.5 billion. Revenue at Microsoft’s Business Division, Client and Server and Tools businesses, the company’s largest, fell during the quarter. The others, including the Entertainment and Devices unit, rose.
Pacific Crest analyst Brendan Barnicle told Bloomberg News that “people were anticipating more of a blowout. It’s a decent quarter. It’s not a great quarter by any means, and people were anticipating a great quarter.”
The earnings are puzzling because, as Bloomberg notes, “A report from researcher IDC showed personal-computer buys exceeded forecasts in the quarter.” Moreover, both IBM (NYSE: IBM) and Intel (NASDAQ: INTC) reported better-than-expected results.
No wonder Chief Executive Steve Ballmer is pushing so hard to purchase Yahoo (NASDAQ: YHOO) to bolster Microsoft’s growth prospects.
Microsoft expects profit in the quarter ending June 30 to be 45 cents to 48 cents per share on revenue of $15.5 billion to $15.8 billion. Analysts expected profit of 46 cents on revenue of $15.56 billion, according to Thomson Financial. Profit for the 2009 fiscal year will be $2.13 to $2.19 per share on revenue of $66.9 billion to $68 billion. That’s greater than the average forecast of Wall Street analysts of profit of $2.10 and revenue of $66.5 billion, according to Reuters.
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