{"id":7095,"date":"2013-01-25T13:06:37","date_gmt":"2013-01-25T12:06:37","guid":{"rendered":"http:\/\/www.itwriting.com\/blog\/?p=7095"},"modified":"2013-01-25T13:06:37","modified_gmt":"2013-01-25T12:06:37","slug":"microsoft-financials-record-revenue-signs-of-windows-8-concern","status":"publish","type":"post","link":"https:\/\/www.itwriting.com\/blog\/7095-microsoft-financials-record-revenue-signs-of-windows-8-concern.html","title":{"rendered":"Microsoft financials: record revenue, signs of Windows 8 concern"},"content":{"rendered":"<p>Yesterday Microsoft released its <a href=\"http:\/\/www.microsoft.com\/investor\/EarningsAndFinancials\/Earnings\/PressReleaseAndWebcast\/FY13\/Q2\/default.aspx\" target=\"_blank\">financial figures<\/a> for the last three months of 2012. <\/p>\n<p><em>Quarter ending December 31st 2012 vs quarter ending December 31st 2011, $millions<\/em><\/p>\n<table cellspacing=\"1\" cellpadding=\"2\" width=\"276\" border=\"1\">\n<tbody>\n<tr>\n<td valign=\"top\" width=\"75\">Segment<\/td>\n<td valign=\"top\" width=\"50\">Revenue<\/td>\n<td valign=\"top\" width=\"50\">Change<\/td>\n<td valign=\"top\" width=\"50\">Profit<\/td>\n<td valign=\"top\" width=\"74\">Change<\/td>\n<\/tr>\n<tr>\n<td valign=\"top\" width=\"75\">Client (Windows + Live)<\/td>\n<td valign=\"top\" width=\"50\">5881<\/td>\n<td valign=\"top\" width=\"50\"><span style=\"color: #ff0000\"><span style=\"color: #000000\"><font color=\"#000000\">+1140<\/font><\/span><\/span><\/td>\n<td valign=\"top\" width=\"50\">3296<\/td>\n<td valign=\"top\" width=\"74\"><span style=\"color: #ff0000\"><span style=\"color: #000000\"><font color=\"#000000\">+416<\/font><\/span><\/span><\/td>\n<\/tr>\n<tr>\n<td valign=\"top\" width=\"75\">Server and Tools<\/td>\n<td valign=\"top\" width=\"50\">5186<\/td>\n<td valign=\"top\" width=\"50\">+171<\/td>\n<td valign=\"top\" width=\"50\">2121<\/td>\n<td valign=\"top\" width=\"74\">+409<\/td>\n<\/tr>\n<tr>\n<td valign=\"top\" width=\"75\">Online<\/td>\n<td valign=\"top\" width=\"50\">869<\/td>\n<td valign=\"top\" width=\"50\">+85<\/td>\n<td valign=\"top\" width=\"50\"><span style=\"color: #ff0000\">-283<\/span><\/td>\n<td valign=\"top\" width=\"74\"><span style=\"color: #ff0000\"><font color=\"#000000\">+176<\/font><\/span><\/td>\n<\/tr>\n<tr>\n<td valign=\"top\" width=\"75\">Business (Office)<\/td>\n<td valign=\"top\" width=\"50\">5691<\/td>\n<td valign=\"top\" width=\"50\"><span style=\"color: #ff0000\"><font color=\"#ff0000\">-619<\/font><\/span><\/td>\n<td valign=\"top\" width=\"50\">3565<\/td>\n<td valign=\"top\" width=\"74\"><span style=\"color: #ff0000\"><font color=\"#ff0000\">-623<\/font><\/span><\/td>\n<\/tr>\n<tr>\n<td valign=\"top\" width=\"75\">Entertainment and devices<\/td>\n<td valign=\"top\" width=\"50\">3772<\/td>\n<td valign=\"top\" width=\"50\"><span style=\"color: #ff0000\"><span style=\"color: #000000\"><font color=\"#ff0000\">-466<\/font><\/span><\/span><\/td>\n<td valign=\"top\" width=\"50\"><span style=\"color: #ff0000\"><span style=\"color: #000000\"><font color=\"#000000\">596<\/font><\/span><\/span><\/td>\n<td valign=\"top\" width=\"74\"><span style=\"color: #ff0000\"><span style=\"color: #000000\"><font color=\"#000000\">+79<\/font><\/span><\/span><\/td>\n<\/tr>\n<\/tbody>\n<\/table>\n<p>Although Microsoft reported record revenue, I do not consider these figures all that revealing. The transcript of the earnings call is more to the point. A few notable remarks from CFO Peter Klein and General Manager Investor Relations Chris Suh<\/p>\n<ul>\n<li>60 million Windows 8 licenses sold and 100 million apps downloaded. At 1.66 apps per license that shows lack of interest in the new Windows Store and raises suspicions that some of those sales may actually be downgraded to Windows 7. The remarks from Klein confirm that the new platform is off to a slow start:<\/li>\n<\/ul>\n<blockquote>\n<p>It\u2019s early days and an ambitious endeavor like this takes time. Together with our partners, we remain focused on fully delivering the promise of Windows 8.<\/p>\n<p>\u2026<\/p>\n<p>While the number of apps in the Windows Store has quadrupled since launch, we clearly have more work to do. We need more rich, immersive apps that give users\u2019 access to content that informs, entertains and inspires.<\/p>\n<\/blockquote>\n<ul>\n<li>Suh states that Windows is selling better to businesses than consumers. Declining interest from consumers is obvious if you walk around a few retailers selling Windows PCs:<\/li>\n<\/ul>\n<blockquote>\n<p>Within the x86 PC market, we saw similar trends to prior quarters, with emerging markets outperforming developed markets, and business outperforming consumer. The consumer segment was most impacted by the ecosystem transition, as demand exceeded the limited assortment of touch devices available. <\/p>\n<\/blockquote>\n<ul>\n<li>System Center 18% revenue growth<\/li>\n<li>SQL Server revenue 16% growth<\/li>\n<li>Online revenue (this is Bing not Azure) up 11%<\/li>\n<li>Windows Phone sales 4 times higher than last year<\/li>\n<li>Skype calls up 59%<\/li>\n<\/ul>\n<p>The company says little about Office 365 and Azure, but my perception is that both are growing fast though how significant they are versus traditional software license sales is less clear.<\/p>\n<p>Trouble ahead? With Windows 8 struggling for acceptance, Office under threat from online and device alternatives, the games console business (overall not just Microsoft) probably in permanent decline, and Windows Phone not yet quite mainstream, you would think so. On the other hand, this is a company with a broad and deep product range and looking at the solid performance of the server products and continuing strength of Windows and Office in business, we may continue to be surprised at its resilience.<\/p>\n","protected":false},"excerpt":{"rendered":"<p>Yesterday Microsoft released its financial figures for the last three months of 2012. Quarter ending December 31st 2012 vs quarter ending December 31st 2011, $millions Segment Revenue Change Profit Change Client (Windows + Live) 5881 +1140 3296 +416 Server and Tools 5186 +171 2121 +409 Online 869 +85 -283 +176 Business (Office) 5691 -619 3565 &hellip; <a href=\"https:\/\/www.itwriting.com\/blog\/7095-microsoft-financials-record-revenue-signs-of-windows-8-concern.html\" class=\"more-link\">Continue reading <span class=\"screen-reader-text\">Microsoft financials: record revenue, signs of Windows 8 concern<\/span> <span class=\"meta-nav\">&rarr;<\/span><\/a><\/p>\n","protected":false},"author":1,"featured_media":0,"comment_status":"open","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[19,55,67],"tags":[388,586,662,814,996],"class_list":["post-7095","post","type-post","status-publish","format-standard","hentry","category-cloud-computing","category-microsoft","category-professional","tag-financials","tag-microsoft","tag-office","tag-server","tag-windows"],"_links":{"self":[{"href":"https:\/\/www.itwriting.com\/blog\/wp-json\/wp\/v2\/posts\/7095","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/www.itwriting.com\/blog\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/www.itwriting.com\/blog\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/www.itwriting.com\/blog\/wp-json\/wp\/v2\/users\/1"}],"replies":[{"embeddable":true,"href":"https:\/\/www.itwriting.com\/blog\/wp-json\/wp\/v2\/comments?post=7095"}],"version-history":[{"count":0,"href":"https:\/\/www.itwriting.com\/blog\/wp-json\/wp\/v2\/posts\/7095\/revisions"}],"wp:attachment":[{"href":"https:\/\/www.itwriting.com\/blog\/wp-json\/wp\/v2\/media?parent=7095"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/www.itwriting.com\/blog\/wp-json\/wp\/v2\/categories?post=7095"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/www.itwriting.com\/blog\/wp-json\/wp\/v2\/tags?post=7095"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}