Microsoft Grows Revenues 5% In 2nd Quarter To $19.95 Billion [Slides]

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Microsoft just released positive earnings for the fifth quarter in a row, with second quarter revenues of $19.95 billion, a 5% increase from last year. Diluted earnings per share were $0.77 per share. The company beat the street as analysts expected revenue to come in at $19.14 billion and diluted earnings per share of $0.68. Operating income and net income for the quarter were $8.17 billion and $6.63 billion, a decrease of 4% and 0.4%, respectively, over the same time last year.

Some highlights from the quarter:

  • Revenues for the Windows division were down 29.7 percent to $5 billion. Operating profits were also down by about $2 billion.
  • More than 20 percent of PCs worldwide (300 million) are now running Windows 7.
  • Microsoft’s business division (powered by Office) grew 24 percent to $6 billion in revenues, and operating profits were a very healthy $3.97 billion.
  • The online division grew 19 percent to $691 million in revenues, but losses widened to $543 million.
  • Online advertising revenues were up 23 percent.
  • Xbox Kinnect sold 8 million units in 60 days, driving the entertainment division’s revenues up 55 percent to $3.7 billion.

Below is a breakdown of Microsoft’s revenues and operating profits by business (You can read the entire report here):

MICROSOFT CORPORATION

Segment Revenue and Operating Income (Loss)
(In millions) (Unaudited)

Three Months Ended
December 31,
Six Months Ended
December 31,
2010 2009 2010 2009
Revenue
Windows & Windows Live Division $5,054 $7,193 $9,839 $10,063
Server and Tools 4,390 3,978 8,349 7,523
Online Services Division 691 579 1,218 1,067
Microsoft Business Division 6,032 4,864 11,157 9,360
Entertainment and Devices Division 3,698 2,381 5,493 3,815
Unallocated and other 88 27 92 114
Consolidated $19,953 $19,022 $36,148 $31,942
Operating Income (Loss)
Windows & Windows Live Division $3,251 $5,417 $6,573 $6,894
Server and Tools 1,776 1,464 3,415 2,709
Online Services Division (543) (463) (1,103) (940)
Microsoft Business Division 3,965 2,947 7,340 5,744
Entertainment and Devices Division 679 365 1,067 640
Corporate-level activity (963) (1,217) (2,011) (2,052)
Consolidated $8,165 $8,513 $15,281 $12,995



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