Microsoft (MSFT) posted EPS of $.33 in the first quarter compared with $.47 in the same period last year.
The period, which is the fiscal third quarter for the company, saw revenue fall to $13.65 billion from $14.45 billion.
Microsoft offers updated operating expense guidance of $26.7 billion to $26.9 billion, including severance charges, for the full year ending June 30, 2009. That will not go over well with investors.
Revenue in the flagship Client division dropped sharply to $4.3 billion. The revenue at the Business division was off slightly to $4.5 billion. The only division that had an uptick was Servers and Tools with revenue of $3.5 billion.
The company’s entertainment products, mostly Xbox sales, reported flat revenue at $1.6 billion. But, online services, including MSN had a drop in revenue from $843 million to $721 million. Losses at the unit rocketed up to $575 million from $226 million.
No wonder MSFT needs a deal with Yahoo!.
Douglas A. McIntyre