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

To: Andy Yamaguchi who wrote (21021)	4/20/1999 7:39:00 PM
From: taxman	Read Replies (1) \| Respond to of 74651

"Tomorrow, we may see a big sell of for the stock and the tech sector." do you think the people trading in the aftermarket at approximately the same price as the regular close are stupid? does this clear it up? regards Microsoft shares fall following revenue delay, report of reorganization By RORY MARSHALL Associated Press DataStream - March 12, 1999 17:49 Associated Press Writer SEATTLE (AP) - Microsoft stock slipped Friday after the company said it would defer about $400 million in revenue because of a delay in introducing Office 2000, the latest version of its suite of business software. Reports of a pending corporate reorganization helped keep the shares actively switching between positive and negative territory throughout the trading session. Microsoft said it still expects to meet Wall Street's third-quarter earnings estimate of 65 cents a share, due to improved investment income. The company expects sales of about $4.2 billion, compared with earlier analysts' estimates of $4.6 billion or higher. Most of the deferred revenue, equal to about 8 cents a share in net income, will be recognized in the fourth quarter when Office 2000 is shipped, chief financial officer Greg Maffei said. Office 2000, a revamped version of Office 97 package of word-processing, spreadsheet and database software, was originally expected to be on store shelves by the end of March, when the third quarter ends. Friday's stock activity was also influenced by a new report that Microsoft plans to announce as soon as next week a restructuring into four major groups. The Wall Street Journal reported the software giant will rejigger its structure into groups for corporate enterprise, aimed at selling products to corporate chief information officers; applications, targeted at "knowledge workers" including analysts, administrators, writers and researchers; software programmers; and consumers, for online and Internet customers who use their computers for entertainment and personal applications. The Seattle Times reported a similar plan last month. A company spokesman wouldn't offer many details. "Sure, Microsoft is planning to make some adjustments to the internal structure, but we're not confirming any dates or details," spokesman Dan Leach said. The company's reorganization plan doesn't appear to be specifically related to its ongoing antitrust case in Washington, D.C. But Scott McAdams, an analyst at McAdams Wright Ragen Inc. in Seattle, said it may help the company pre-empt the effects of a negative court verdict. "It doesn't surprise me to see them do it," he said. "If you think the stars are lining up to force you to do something some day, better to be pro-active than be ordered to do it." Reorganizations, he noted, are not rare at Microsoft, a company that has grown explosively in the past two decades. "Every couple of years they turn the battleship around," he said. "They've mostly all worked." Reports indicate the reorganization was being driven by the company's president, Steve Ballmer, second in command to founder and Chairman Bill Gates. Microsoft would use the reorganization to focus the company's efforts on customers rather than around particular product lines and engineering efforts. Ballmer has been overseeing the Interactive Media Group, which includes the online Microsoft Network and may be renamed the consumer division. Microsoft will temporarily divide responsibilities for the consumer unit between Jon DeVaan, who has overseen development of Microsoft Office, the suite of software applications that includes Word and Excel; and Brad Chase, a marketing manager who masterminded the launch of Windows 95 and Internet Explorer, The Journal reported. The division aimed at software developers will reportedly be headed by Paul Maritz, who has overseen nearly all software development at the company. In settling on the reorganization plan, people familiar with the matter told The Journal that Ballmer rejected more far-reaching initiatives, including a proposal to spin off MSN into a separate company. The company reportedly has courted but failed to land several top outside media executives to head MSN. © 1998 MarketWatch.com, L.L.C. All rights reserved. Disclaimer.

To: Andy Yamaguchi who wrote (21021)	4/20/1999 7:43:00 PM
From: Catcher	Respond to of 74651

andy this sounds reasonable, but somehow i don't think a stunning observation like this would be missed by hundreds of analysts who already have a hold of the numbers. nor would msft attempt a charade of this magnitude--this ain't cpq

To: Andy Yamaguchi who wrote (21021)	4/20/1999 7:50:00 PM
From: Jim Matsui	Read Replies (1) \| Respond to of 74651

Andy, Where did you see the $750 million in investment income number? According to the WSJ Online: "The reported revenue doesn't include revenue of $400 million from sales of Microsoft Office 97; Microsoft has deferred that revenue to its fourth quarter, telling analysts that the deferral is related to its provision of a free upgrade to customers who bought Office 97 during the quarter. The company is giving Office 97 purchasers a free upgrade to Office 2000, which ships this quarter. The deferral of Office revenue is equivalent to four cents a share, but Microsoft said it realized investment gains of more than $350 million during the quarter, making up the discrepancy." Jim