How high will Microsoft fly? Message Board

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Technology Stocks : How high will Microsoft fly?

MSFT 496.34

-0.2%

3:56 PM EST

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To: Exacctnt who wrote (5531)	3/24/1998 11:29:00 PM
From: Exacctnt	Read Replies (1) of 74651

To All, I listened to the conference call today and made the following notes. Microsoft said they had the conference call because of the turmoil being created in the market from questions about PC demand and Asia. They also said they thought they should prepare the street that earnings were at least ten percent higher than estimates. Results were strong across all product lines. The best performers, were the NT Server and the Back Office Line. PC sales were healthy this quarter, but stressed caution on demand going forward. They indicated that Microsoft's products were a lagging indicator for the PC industry. Asia operations were weak. They said that sales in Asia weren't getting weaker, but sales weren't improving. Cost controls added to earnings for this quarter. There was less marketing expense, but this savings wasn't sustainable in future quarters. EPS will exceed estimates by 4 cents or a little more. They report solid growth, but growth is slowing because of their expanding base. Third quarter earnings could be the highest earnings reported in calendar 98. They said there is no evidence to suggest that analysts should raise future earnings estimates. The following comments were made in response to questions from analysts: On PC demand -- Microsoft is lagging indicator. No evidence of enormous slowdown in PC demand. PC unit growth - steady as she goes. Microsoft could have several "kissing cousins" earnings reports in a row. Windows 98 will be released as scheduled. It is unlikely that Win98 sales will be as big as Win95. They are not looking for a big increase in earnings from Win98. Fourth quarter earnings -- Maybe a few pennies to add to estimates, but lower than third quarter. Deferred Earnings will grow. I think they said that interest income is higher because they didn't buy, or didn't buy back as much stock as in prior quarter. Asked to pick one product that excelled -- Office Asked to pick one region that grew the most -- Europe __________________________________________________________ Anyone interested in hearing the replay of the conference call, can call 1-888-566-0511 and use 1017 for the access code. Regards, Bob

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