Charges Hit Microsoft's Net, But Guidance Worth A Look (MSFT)

Microsoft (NASDAQ:MSFT) just posted EPS as $0.31 net, but that would have been $0.39 before the $1 Billion+ Xbox charge that had already been noted.  It posted revenues of $13.37 Billion, and that compared to estimates of $13.27 Billion.  The company issued guidance of $0.38-$0.40 EPS, above the 0.38 estimate and put revenues at $12.4-12.6 Billion versus 12.5 Billion estimates.  It also put fiscal June-2008 Annual EPS at $1.69-$1.73 versus 1.71 estimates and put revenues in a $56.8-$57.8 Billion range versus $57 Billion estimates.

This marked the fiscal year-end for Microsoft and it acheived $50 Billion in annual sales.  The company said that strong Windows Vista sales and the Office 2007 sales were helping, but those are not broken out.  It also noted the strength in SQL Server, Windows Server, Visual Studio, and Xbox 360 consoles.  Microsoft closed up 1.9% at $31.51 on the day in normal trading, and shares initially traded up 0.5% at $31.67 in after-hours trading before going back into negative territory.

Here was the full earnings preview for Microsoft, along with the Google comparison.

Jon C. Ogg
July 19, 2007

Jon Ogg can be reached at [email protected]; he does not own securities in the companies he covers.