Microsoft reports record near US$20bn quarter

27 Jan 2011

Microsoft reported record US$20bn revenues for its second quarter and profits of US$6.6bn. The strong results reflected sustained demand for the Windows 7 operating system, Office 10 and some 8m sales of Kinect sensors.

“We are enthusiastic about the consumer response to our holiday line-up of products, including the launch of Kinect. The 8m units of Kinect sensors sold in just 60 days far exceeded our expectations,” said Peter Klein, chief financial officer at Microsoft.

“The pace of business spending, combined with strong consumer demand, led to another quarter of operating margin expansion and solid earnings per share growth.”

Among the factors driving Microsoft’s record revenues and earnings per share was the 55pc growth in revenue for the Entertainment & Devices Division, as the success of the Kinect sensor boosted sales of Xbox 360 consoles, Xbox Live subscriptions and Xbox games.

Office 10 is fastest-selling consumer version in history

Microsoft Business Division revenue grew 24pc year-over-year. Office 2010 is the fastest-selling consumer version of Office in history, with licence sales more than 50pc ahead of Office 2007 over an equivalent period following launch.

“Business demand for our productivity and infrastructure products and cloud solutions is strong. Office had a huge quarter, exceeding everyone’s expectations, and our road map for cloud productivity with Office 365 makes products like SharePoint, Exchange, Lync and Dynamics CRM even more attractive to our customers,” said Kevin Turner, chief operating officer at Microsoft.

“Windows 7 continues to be the fastest-growing operating system in history, and our recent System on a Chip announcement demonstrates our commitment that Windows will have the power and flexibility to run everywhere and on every device.”

Microsoft announced it has now sold more than 300m Windows 7 licences, and Windows 7 is now running on more than 20pc of internet-connected PCs.

Microsoft announced developers are adding Windows Phone 7 applications to the marketplace at a rate of more than 100 per day.

John Kennedy is a journalist who served as editor of Silicon Republic for 17 years