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Microsoft PC nightmare unrealised in Q2

Microscope contributor

A decline in PC sales as a result of the Thai flooding crisis seems to have hurt Microsoft's Q2 numbers less than Redmond had at first feared feared, with strong sales elsewhere in the firm helping to offset the impact of the disaster.

Microsoft today reported a 5% year-on-year sales uptick in the second quarter of its fiscal Q2, but did admit that profits were down slightly to $6.62bn from $6.63bn this time last year.

Out of business-wide sales of $20.89bn (a new company record), Redmond's business division grew sales 3% to $6.28bn. Close to 200 million Office 2010 licences shipped since the product's launch date, it boasted.

Exchange and SharePoint grew around 10% on the same period last year, while sales from Lync and Dynamics CRM were up over 30%.

Microsoft's Server and Tools unit increased sales by 11% to $4.77bn on the back of double-digit sales increases of Windows Server and SQL Server premium editions, together with approximately 20% growth in system management tool System Center revenue, which was recently updated to improve support for virtualisation.

Microsoft's Entertainment and Devices division increased its sales by 15% to $4.24bn on the back of decent consumer demand for its Xbox consoles during the critical Christmas crunch.

However things were less rosy at the Windows and Windows Live division, where sales dropped 6% to $4.74bn for the period.

"We saw strong demand for our business products and services, despite the soft PC market and continuing economic uncertainty in key parts of the world," said Peter Klein, chief financial officer at Microsoft. "We delivered record earnings per share by continuing to manage our costs while investing for future growth."

Meanwhile, CEO Steve Ballmer said the company expected to boost sales off the back of its appearance at CES in Las Vegas.

"Coming out of CES we're seeing very positive reviews for our new phones and PCs, and a strong response to our new Metro style design that will unify consumer experiences across our phones, PCs, tablets, and television in 2012," said the firm's outspoken boss.


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