MSFT REPORT!!
REDMOND, Wash., April 20 /PRNewswire/ -- Microsoft Corp. (Nasdaq: MSFT) today announced net income of $1.92 billion and diluted earnings per share of $0.35 for the quarter ended March 31, 1999, a 40 percent increase over the $0.25 diluted earnings per share reported for the corresponding quarter last year. Revenue totaled $4.33 billion, a 15 percent increase over the $3.77 billion for the comparable quarter last year.
Reported revenue does not include unearned revenue of $400 million related to the Microsoft(R) Office 2000 Technology Guarantee, which will be recognized in coming quarters, as required by generally accepted accounting principles. The Company also realized investment gains of more than $350 million during the quarter.
"Microsoft had solid performance across all product lines, but the brightest spots were the continued migration to Windows NT(R) Workstation, strong demand for Office despite the impending upgrade, and the strength of our server applications. Results in Asia were also much improved," said Greg Maffei, chief financial officer. "However, we remain guarded about growth in 1999, given the likelihood that organizations will lock down their systems infrastructures due to year 2000 concerns."
"Microsoft SQL Server(TM) 7.0 is off to a fabulous start," said Paul Maritz, group vice president, Developer Group. "Corporate customers and applications developers are choosing SQL Server 7.0 for their database server needs, and licenses of SQL Server increased more than 50 percent over the comparable quarter of the prior year."
The English version of Microsoft Office 2000 was released to manufacturing in March, is shipping to volume license customers worldwide in April, and will be broadly available in the US retail channel on June 10. The latest version of the Company's flagship productivity suite makes the Web work for users by streamlining the process of working with people and information, and introduces applications that intelligently repair themselves and adapt to personal usage patterns, making them easier to use and manage.
In March, Microsoft released the latest version of Internet Explorer, the award-winning browser technology. Microsoft Internet Explorer version 5 is the fastest full-featured browser available today and is the only browser to include IntelliSense(R) technology to make browsing the Web easier than ever. Internet Explorer 5 software provides an open platform for software vendors and Web content providers through its support for Web standards and rich extensibility options. Also integrated into Internet Explorer 5 is the Microsoft Windows Media(TM) player, providing customers with easy access to the most compelling audio and video content on the Web.
Also in March, the Company announced a comprehensive strategy for e-commerce, including Microsoft BizTalk, a new cross-platform e-commerce XML-based framework enabling business-to-business commerce over the Internet. More than one million Internet sites already use Windows NT Server, according to an April NetCraft survey of Internet web sites. Windows NT Server is the platform for BizTalk Server, a forthcoming Microsoft product supporting the BizTalk framework. Also, a December Intelliquest study indicated that Windows NT Server is the leading intranet platform, running on 47 percent of corporate intranets.
Microsoft released the latest version of the Windows(R) CE operating system for the Palm-size PC -- the first to enable color -- in February. Although similar in functionality to Palm-size PC software that is shipping in devices today, the color-enabled release of Windows CE for the Palm-size PC brings an unmatched clarity to device screens, increasing the readability on these compact, portable devices.
This press release contains statements that are forward-looking. These statements are based on current expectations that are subject to risks and uncertainties. Actual results will vary because of factors such as PC shipment growth; technological shifts; customer demand; competitive products and pricing; product mix; product ship schedules; life cycles; the impact that year 2000 issues may have on demand for Microsoft's products and services; terms and conditions; litigation; and other issues discussed in the Company's Form 10-K.
Founded in 1975, Microsoft is the worldwide leader in software for personal computers. The Company offers a wide range of products and services for business and personal use, each designed with the mission of making it easier and more enjoyable for people to take advantage of the full power of personal computing every day.
NOTE: Microsoft, IntelliSense, Windows, Windows Media, and Windows NT are either registered trademarks or trademarks of Microsoft Corp. in the United States and/or other countries.
Microsoft Corporation
Income Statements
(In millions, except earnings per share)
Three Months Ended Nine Months Ended
Mar. 31 Mar. 31
1998 1999 1998 1999
Revenue $3,774 $4,331 $10,489 $13,222
Operating expenses:
Cost of revenue 317 350 883 1,090
Research and development 597 611 1,791 1,889
Acquired in-process technology 0 0 296 0
Sales and marketing 829 996 2,493 2,766
General and administrative 104 144 305 392
Other expenses 60 1 181 60
Total operating expenses 1,907 2,102 5,949 6,197
Operating income 1,867 2,229 4,540 7,025
Investment income 190 720 489 1,318
Gain on sale 0 0 0 160
Income before income taxes 2,057 2,949 5,029 8,503
Provision for income taxes 720 1,032 1,896 2,920
Net income $1,337 $1,917 $ 3,133 $ 5,583
Earnings per share (A):
Basic $ 0.27 $ 0.38 $ 0.64 $ 1.11
Diluted $ 0.25 $ 0.35 $ 0.59 $ 1.02
(A) Earnings per share for the three and nine months ended March 31, 1998
have been restated to reflect a two-for-one stock split in March 1999.
Microsoft Corporation
Channel and Product Group Revenue
(In millions)
Three Months Ended Nine Months Ended
Mar. 31 Mar. 31
1998 1999 1998 1999
Channels
South Pacific and
Americas Region $1,256 $1,331 $ 3,543 $ 4,344
Europe, Middle East,
and Africa Region 897 932 2,457 2,969
Asia Region 388 475 1,061 1,155
OEM 1,233 1,593 3,428 4,754
Total revenue $3,774 $4,331 $10,489 $13,222
Product groups
Platforms $1,626 $2,053 $ 4,570 $ 6,299
Applications and Tools 1,868 1,937 4,977 5,799
Interactive Media and Other 280 341 942 1,124
Total revenue $3,774 $4,331 $10,489 $13,222
Microsoft Corporation
Balance Sheets
(In millions)
June 30, 1998 Mar. 31, 1999
Assets
Current assets:
Cash and short-term investments $13,927 $21,761
Accounts receivable 1,460 1,689
Other 502 608
Total current assets 15,889 24,058
Property and equipment 1,505 1,445
Equity investments 4,703 7,474
Other assets 260 584
Total assets $22,357 $33,561
Liabilities and stockholders' equity
Current liabilities:
Accounts payable $ 759 $ 1,016
Accrued compensation 359 289
Income taxes payable 915 1,347
Unearned revenue 2,888 4,195
Other 809 992
Total current liabilities 5,730 7,839
Stockholders' equity:
Convertible preferred stock 980 980
Common stock and paid-in capital 8,025 12,418
Retained earnings 7,622 12,324
Total stockholders' equity 16,627 25,722
Total liabilities and
stockholders' equity $22,357 $33,561
SOURCE Microsoft Corp.
/NOTE TO EDITORS: If you are interested in viewing additional information
on Microsoft, please visit the Microsoft Web page at
microsoft.com on Microsoft's corporate information
pages. Shareholder and financial information as well as today's 2:30 p.m. PDT
conference call with financial analysts is available at
microsoft.com.
/CONTACT: financial analysts only, Carla Lewis, Senior Director, Investor
Relations, 425-936-3703; or press only, Caroline Boren of Waggener Edstrom,
425-637-9097, for Microsoft/
/Company News On-Call: prnewswire.com or fax,
800-758-5804, ext. 569457/
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