The fiscal third quarter for Microsoft finished with a 13 percent increase in revenue, as the company saw 21 percent revenue growth in Microsoft Business Solutions, which oversees the Dynamics line of business applications.
Revenue for the quarter was $10.90 billion, and net income was $2.98 billion for 29 cents per share. Demand for the Xbox 360 gaming console helped the numbers too, as the Home and Entertainment division jumped more than 80 percent in revenue.
Unfortunately, supply did not meet Xbox 360 demand, and it is still difficult to find in some areas. Home and Entertainment’s operating income dropped by $388 million during the quarter according to Microsoft’s financial statements.
“We are pleased with the increasing pace of revenue growth throughout this fiscal year fueled by strong demand for our new consumer and business offerings,” said Chris Liddell, chief financial officer of Microsoft.
He noted the uptick in accelerating investment in Microsoft’s business. The company repurchased $4.9 billion of its stock in buybacks performed during the quarter.
Customers certainly bought into Microsoft’s message that it can provide value as a single point of contact for software and applications. “The Windows Server platform value proposition is truly resonating with customers, as shown by growth in Microsoft SQL Server revenue of over 30% this quarter,” said Kevin Johnson, co-president, Platforms & Services Division.
Microsoft could do with some cost cutting though, as one analyst fretted in a Bloomberg report about Microsoft’s increased costs related to the business.
“They run this company really fat to begin with and if they are getting even fatter it’s absurd,” said Sanford C. Bernstein & Co. analyst Charles Di Bona.
Now haven’t we heard that before?
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David Utter is a staff writer for Murdok covering technology and business.
