Silicon Investor (SI) -- The First Internet Community

STOCKTALK

We've detected that you're using an ad content blocking browser plug-in or feature. Ads provide a critical source of revenue to the continued operation of Silicon Investor. We ask that you disable ad blocking while on Silicon Investor in the best interests of our community. If you are not using an ad blocker but are still receiving this message, make sure your browser's tracking protection is set to the 'standard' level.

Technology Stocks : How high will Microsoft fly? -- Ignore unavailable to you. Want to Upgrade?

To: EepOpp who wrote (26519)	7/18/1999 2:02:00 AM
From: puborectalis	Respond to of 74651

Microsoft earnings forecast likely to show 'a solid quarter' by Jay Greene Seattle Times technology reporter Microsoft, currently under investigation by securities regulators for smoothing out its earnings, will likely post yet another steady quarter Monday. Analysts expect Microsoft to meet or slightly exceed their expectations, earning a penny or two more than the consensus 36 cents a share for the fourth quarter that ended June 30. The company earned 25 cents a share a year ago. Analysts expect revenue to climb to $5 billion, up from $4 billion a year ago. Microsoft plans to release results after the market closes Monday. "I'm not expecting a blowout quarter," said J.P. Morgan analyst Bill Epifanio. "I'm expecting a solid quarter." Office 2000 sales will likely drive results. The suite of applications, launched June 10, got out of the gate strong, with corporate customers updating their systems. "You're getting a very strong product at the beginning of its life cycle," Epifanio said. Office holds more than 90 percent of the business-productivity market. As in recent quarters, results will likely be buoyed by sales of Windows NT for workstations, another product for corporate customers that has been performing well. Epifanio expects Microsoft Chief Financial Officer Greg Maffei to wax cautious during a conference call with analysts about the remainder of 1999. The summer quarter, which ends Sept. 30, is traditionally slow. On top of that, corporate customers are expected to slow their purchases through the rest of the year as they prepare for potential computer problems related to the year 2000. "I think Greg will be especially cautious," Epifanio said. Late last month, Microsoft disclosed that the Securities and Exchange Commission is investigating possible accounting improprieties. The agency is looking into whether Microsoft improperly manipulated its books by shifting earnings from strong quarters into its reserves, then dipped into that pot during sluggish quarters. The practice, called "cookie jar" accounting, makes results appear more stable than they actually are. When Maffei discusses results with analysts, it is unlikely he will discuss the SEC investigation further. One issue likely to come up is a recurring rumor that Microsoft may launch a so-called "tracking stock" to enhance the market value of its Internet business. Reports yesterday of the possibility sent Microsoft shares to an all-time high of $99.875 in intraday trading. The stock finished at $99.438, up $5.063. Microsoft has said that while it has considered creating a tracking stock, it has no current plans to do so.