Microsoft profit jumps; sales rise at fastest pace in two years
Microsoft Corp., the world’s largest software maker, reported fourth-quarter profit topped analysts’ estimates after customers purchased more personal computers running the Windows operating system.
Net income climbed to $4.52 billion, or 51 cents a share, compared with the 46-cent average of estimates compiled by Bloomberg. Sales rose 22 percent, the most in more than two years, to $16 billion, the company said today in a statement.
Microsoft is benefitting from a recovery in spending by large businesses. The company said in late June it had sold 150 million copies of its newest Windows 7, making it the fastest- selling operating system in the Redmond, Washington-based company’s history. Global PC shipments jumped last quarter, according to research firm Gartner Inc.
“It sounds like enterprises are buying Windows 7 and will roll it out at some point,” said Brendan Barnicle, an analyst at Pacific Crest Securities in Portland, Oregon, who recommends buying the shares and doesn’t own any himself. “We’ve seen more and more evidence of a recovery in enterprise spending.”
Microsoft rose 72 cents to $25.84 at 4 p.m. New York time on the Nasdaq Stock Market. The stock slid 21 percent last quarter, compared with a 12 percent drop in the Standard and Poor’s 500 Index.
Analysts had projected total sales of $15.3 billion for the fourth quarter, which ended June 30.
Net income in the fourth quarter of 2009 was $3.05 billion, or 34 cents a share, on sales of $13.1 billion. Net income in that period included legal expenses, severance costs and impairments to investments.
Operating expenses for the year starting July 1 will be $26.9 billion to $27.3 billion, the company said, down from its March forecast of $27 billion to $27.5 billion. Microsoft no longer provides projections for sales and profit.
PC shipments rose 21 percent in the second quarter, Gartner said, beating the firm’s projection of 19 percent. Intel Corp., the world’s biggest chipmaker, posted record second-quarter sales and said corporate spending is strengthening.
Apple Inc., which competes with Microsoft in operating systems for computers, tablets and mobile phones, reported quarterly sales this week of $15.7 billion, topping analysts’ estimates.
Microsoft’s Bing Internet search engine gained a point of U.S. market share during the quarter, rising to 12.7 percent, according to ComScore Inc. in Reston, Virginia. That compared with 62.6 percent for Google Inc. and 18.9 percent for Yahoo! Inc., which is switching over to using Bing’s technology.
