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

To: prosperous who wrote (51528)	10/18/2000 4:52:40 PM
From: Andy Yamaguchi	Respond to of 74651

MSFT's operating income this Q was 2.777 B vs 2.789B last year. They simply sold 1.27B of their VC holding to add the earning. The quality of the earning for MSFT is not good. This is quite misleading to individual investors. If a company like MSFT can mislead the investors by selling their Venture capital holdings, who can we trust?

To: prosperous who wrote (51528)	10/18/2000 4:54:33 PM
From: Harvey Allen	Read Replies (1) \| Respond to of 74651

First quarter investment income increased to $1.13 billion from $550 million in the first quarter of the prior year. The increase was due to net realized gains and the larger investment portfolio. Net realized gains represented about $600 million of the investment income in the first quarter of fiscal 2001. Investment income in the September quarter of fiscal 2000 included a gain of $156 million related to the sale of Sidewalk and $50 million in other net realized gains. The Company was required to adopt Standard of Financial Accounting Standards, SFAS 133, Accounting for Derivative Instruments and Hedging Activities, which requires that all derivatives be recognized as either assets or liabilities measured at fair value. The accounting for changes in the fair value of a derivative depends on the use of the derivative. Adoption of this new accounting standard resulted in cumulative after-tax reductions in net income of $375 million in the first quarter of fiscal 2001. The effective tax rate for fiscal 2001 is 33%. The effective tax rate for fiscal 2000 was 34%. also During the September quarter, the Company repurchased 25.5 million shares of common stock under its stock repurchase program. At September 30, 2000, Microsoft had 157 million outstanding put warrants giving holders the right to sell shares of Microsoft common stock to the Company with strike prices ranging from $70 to $78 per share and expirations ranging from December 2000 to March 2003. These put warrant contracts permit a net-share settlement at the Company’s option. microsoft.com cc webcast 2:30 pm - 3:30 pm Pacific time 5:30 pm - 6:30 pm Eastern time www2.vcall.com