MICROSOFT CORP Quarterly Report for Q1 Ended Sep 30, 2010

Summary

Microsoft Corporation reported strong financial results for the quarter ending September 30, 2010, demonstrating significant year-over-year growth. Revenue increased by 25% to $16.195 billion, driven by robust sales of Windows 7, the 2010 Microsoft Office system, and growth in the Server and Tools, and Entertainment and Devices divisions. Operating income saw a substantial increase of 59% to $7.116 billion. Diluted earnings per share rose to $0.62, a 55% increase from the previous year, largely due to higher net income and continued share repurchases. The company maintained a strong liquidity position with cash, cash equivalents, and short-term investments totaling $44.2 billion. Microsoft continues to invest in its cloud offerings and expand its product lines, positioning itself for continued growth amidst a dynamic global economic landscape.

Key Highlights

• 1Revenue surged 25% year-over-year to $16.195 billion, driven by strong performance in Windows 7, Office 2010, Server and Tools, and Entertainment and Devices segments.
• 2Operating income saw a significant increase of 59% to $7.116 billion, indicating improved profitability.
• 3Diluted earnings per share (EPS) grew by 55% to $0.62, reflecting higher net income and a reduction in outstanding shares due to buybacks.
• 4The company's liquidity remains robust, with cash, cash equivalents, and short-term investments totaling $44.2 billion.
• 5The Windows & Windows Live Division experienced a notable 66% revenue increase, primarily due to strong Windows 7 sales and PC market growth.
• 6The Server and Tools division showed consistent growth with a 12% increase in revenue, supported by strong adoption of Windows Server and SQL Server.
• 7Microsoft repurchased approximately 163 million shares for $4.0 billion during the quarter, continuing its capital return program.

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