What was Microsoft's revenue and net income for the quarter?

For the three months ended December 31, 2011, Microsoft reported revenue of $20.885 billion, a 5% increase from the same period in 2010. Net income was $6.624 billion, a slight decrease from $6.634 billion in the prior year period.

What was the impact of the Skype acquisition on the financial results?

The acquisition of Skype, completed on October 13, 2011, contributed to revenue from the acquisition date. However, it also led to increased operating expenses, including higher headcount-related costs and amortization of acquired intangibles, which impacted profitability.

How is Microsoft managing its substantial cash reserves?

As of December 31, 2011, Microsoft held $51.736 billion in cash, cash equivalents, and short-term investments. The company continues to return capital to shareholders through share repurchases, with $10.2 billion remaining under its authorized program, and by paying quarterly dividends.

Which business segments performed particularly well or poorly during the quarter?

The Server and Tools segment demonstrated strong revenue growth of 11%. The Entertainment and Devices Division also saw a revenue increase of 15%, driven by Xbox 360 platform sales and the inclusion of Skype revenue. The Windows & Windows Live Division experienced a revenue decline of 6%, largely attributed to a softening PC market and a decrease in consumer PC sales.

MSFT 10-Q Quarterly Report Q2 FY2012 — Revenue, Net Income, EPS

Summary

Microsoft Corporation's (MSFT) 10-Q filing for the period ending December 30, 2011, reveals a quarter of solid revenue growth driven by strong performance in the Server and Tools, and Entertainment and Devices segments. The acquisition of Skype, which closed during the quarter, contributed to revenue and also increased operating expenses and headcount. While overall revenue saw a modest increase, operating income experienced a slight dip due to higher operating expenses, including increased cost of revenue and R&D investments. Financially, the company maintains a strong liquidity position with over $51 billion in cash, cash equivalents, and short-term investments. Shareholder returns remain a priority, with ongoing share repurchases and dividend payouts. Investors should note the continued investment in cloud computing and smart connected devices as key strategic growth areas, alongside the ongoing challenges and competitive pressures in the dynamic technology industry.

Financial Highlights

52 data points

Beta

Revenue

$20.89B

0.7% Gross Margin

Net Income

$6.62B

0.3% Net Margin

EPS (Diluted)

$0.78

Total Assets

$112.24B

Cash & Equivalents

$10.61B

Free Cash Flow

$5.36B

Financial Statements

Beta

Revenue	$20.89B
Cost of Revenue	$5.64B
Gross Profit	$15.25B
R&D Expenses	$2.37B
Operating Expenses	$7.25B
Operating Income	$7.99B
Interest Expense	$95.00M
Net Income	$6.62B
EPS (Basic)	$0.79
EPS (Diluted)	$0.78
Shares Outstanding (Basic)	8.40B
Shares Outstanding (Diluted)	8.46B

Key Highlights

1Total revenue for the three months ended December 31, 2011, increased by 5% to $20.885 billion compared to the prior year period.
2Operating income for the quarter decreased slightly by 2% to $7.994 billion, primarily due to increased operating expenses.
3Diluted earnings per share (EPS) saw a slight increase of 1% to $0.78.
4The company completed the acquisition of Skype for $8.6 billion in cash during the quarter, which contributed to revenue from the acquisition date.
5Cash, cash equivalents, and short-term investments remained strong at $51.736 billion as of December 31, 2011.
6The company continued its share repurchase program, with approximately $10.2 billion remaining authorized under its program.
7Revenue from the Server and Tools segment showed robust growth of 11% for the quarter.

MICROSOFT CORP Quarterly Report for Q2 Ended Dec 31, 2011

Summary

Financial Highlights

Key Highlights

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