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Halo 3 helps boost Microsoft profits

26 октября 2007

Microsoft shares soared to their highest level in more than six years late on Thursday as the software giant reported a surge in growth from its core desktop software products and raised its forecasts for the rest of its fiscal year.

Halo 3 helps boost Microsoft profitsThe news that the latest Windows and Office product cycles were turning out to be stronger than expected, along with $300m in sales from a new version of the Halo video game, boosted the shares by more than 10 per cent in after-market trading.

Other rallies in recent years have been capped by concerns about Microsoft’s longer-term prospects as the focus of computing shifts from the PC to the internet.

In the latest quarter, Microsoft said revenues jumped by 27 per cent, the fastest rate of growth since the peak of the tech boom in 1999, while earnings rose by 29 per cent.

The effects of a weak dollar and the acquisition of aQuantive, the online advertising company, helped the company beat its own and Wall Street’s expectations, but the bulk of the outperformance reflected “strength across the board”, said Chris Liddell, chief financial officer.

Revenues of $13.76bn were $220m ahead of market expectations, while earnings per share of 45 cents were up from 35 cents a year before and ahead of the expected 39 cents.

The company’s operating profit margin jumped by two percentage points to 43 per cent, reflecting the fact that it had kept the growth of its operating costs on target even as its revenues climbed higher than forecast, said Mr Liddell.

Sales of the new Windows Vista operating system pushed revenues from the client division, Microsoft’s biggest business, up 25 per cent to $4.1bn, while operating revenues rose 27 per cent to $3.4bn. The performance had been helped by continued strength in the PC market and greater success in combating software piracy, said Mr Liddell.

The new version of Office had pushed revenues in the business division up 20 per cent to $2.7bn.

Meanwhile, the launch of Halo 3 late in the quarter pushed the consumer division into profit.

The company said it had raised its revenue guidance for the year as a whole by $2bn, with earnings per share guidance rising by 8 cents.

Microsoft’s internet arm was the only division not to beat expectations; revenues rose 25 per cent to $671m and losses more than doubled to $264m.
 
Microsoft’s shares rose by $3.26 in after-market trading to $35.27, adding more than $30bn to its stock market value. Other rallies in recent years have stalled when the company’s shares have risen past $30.

Источник: Financial Times

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