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Microsoft delivers in Q4 but doubts remain over phone plans

Microscope contributor

by Linda Endersby

Microsoft has announced record fourth quarter profits with revenues of $16.04bn for the quarter ending 30th June 2010, up 22% from the same period last year.

The vendor easily beat Wall Street forecasts but analysts and investors continue to question where future growth will come from.

With operated income at $5.93bn and net income at $4.52bn for the quarter showing almost 50% increases compared to the prior year end and the diluted earnings at $0.51 per share showing the same increase, Microsoft delivered in the software product areas the firm is known to be good at.

"We saw strong sales execution across all of our businesses, particularly in the enterprise with Windows 7 and Office 2010," said Kevin Turner, chief operating officer.

"Our transition to cloud services is well underway with offerings like Windows Azure and our Business Productivity Online Services, and we look forward to continuing our product momentum this fall with the upcoming launches of Windows Phone 7 and Xbox Kinect," he added.

"This quarter's record revenue reflects the breadth of our offerings and our continued product momentum," said Peter Klein, CFO. "The revenue growth, combined with our ongoing cost discipline, helped us achieve another quarter of margin expansion."

However, according to the Wall Street Journal investors remain cautious over Microsoft's push into the mobile phone market where rivals like Apple are thriving and suggest this skepticism will not be quieted by these results.

Fiscal year end figures show record revenue of $6.24 bn a 7% increase from the previous year, while operating income and net income are $24.10bn and $18.76bn , rises of 18% and 19%. Diluted earnings per share are $2.10 an increase of 30%.


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