Microsoft’s Annual Revenue Surpasses $50 Billion
Microsoft Corp. today announced revenue of $13.37 billion for the quarter ended June 30, 2007, a 13% increase over the same period of the prior year. Diluted earnings per share for the quarter were $0.31. Excluding $0.08 of previously announced charges primarily related to Xbox 360™ warranty policies, earnings per share would have been $0.39, an increase of 26% over the same period of the prior year when also adjusted for certain items.
For the fiscal year ended June 30, 2007, Microsoft announced revenue of $51.12 billion, a 15% increase over the prior year. Diluted earnings per share for the year were $1.42. Excluding certain items, earnings per share would have been $1.49, an increase of 17% over the prior year when also adjusted for certain items. $31 billion in cash, or approximately 175% of operating cash flow, was returned to shareholders during the year through share buybacks and dividends.
“Surpassing $50 billion in annual sales is a testament to the innovation and value that our product groups delivered into the marketplace, as well as the outstanding execution by our field sales, marketing teams and partners to bring that value to life with our customers,” said Kevin Turner, chief operating officer at Microsoft. “In fiscal year 2008, we will continue to drive growth through new product offerings, such as Windows Server® 2008, Visual Studio® 2008, SQL Server™ 2008, Office PerformancePoint™ Server 2007, and Microsoft Dynamics™ Live CRM.”
This fiscal year marked the general availability of Microsoft’s flagship products, Windows Vista® and the 2007 Microsoft Office system. Revenue growth was primarily driven by solid customer acceptance of these products, as well as increasing sales of existing products such as SQL Server, Windows Server, Visual Studio, and Xbox 360™ consoles.
“Our results this quarter cap off an extremely strong fiscal year for the company,” said Chris Liddell, chief financial officer at Microsoft. “We have healthy core businesses and are strategically investing in growth opportunities, which will build on our success and contribute to continued double-digit revenue and earnings growth in fiscal year 2008.”
Microsoft management offers the following guidance for the quarter ending September 30, 2007:
• Revenue is expected to be in the range of $12.4 billion to $12.6 billion.
• Operating income is expected to be in the range of $5.0 billion to $5.2 billion.
• Diluted earnings per share are expected to be in the range of $0.38 to $0.40.
Management offers the following guidance for the full fiscal year ending June 30, 2008:
• Revenue is expected to be in the range of $56.8 billion to $57.8 billion.
• Operating income is expected to be in the range of $22.2 billion to $22.7 billion.
• Diluted earnings per share are expected to be in the range of $1.69 to $1.73.
The foregoing guidance does not include the impact of currently undetermined costs associated with Microsoft’s acquisition of aQuantive, Inc., which is expected to close in the quarter ending September 30, 2007.
Microsoft will hold an audio webcast at 2:30 p.m. PDT (5:30 p.m. EDT) today with Chris Liddell, senior vice president and chief financial officer, Frank Brod, corporate vice president and chief accounting officer, and Colleen Healy, general manager of Investor Relations, to discuss details of the company’s performance for the quarter and certain forward-looking information. The session may be accessed at http://www.microsoft.com/msft. The webcast will be available for replay through the close of business on July 19, 2008.
Microsoft Corporation - Adjusted Financial Results – Non-GAAP Measures Reconciliation
This information has been provided to aid readers of the financial statements in further understanding the company’s financial performance and the impact that certain items and events had on the financial results may not be indicative of trends affecting the company’s business. For comparability of reporting, management considers this information in conjunction with GAAP amounts in evaluating business performance. The non-GAAP financial measures provided above should not be considered as a substitute for, or superior to, the measures of financial performance prepared in accordance with GAAP.
Founded in 1975, Microsoft (Nasdaq “MSFT”) is the worldwide leader in software, services and solutions that help people and businesses realize their full potential.
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