9 ms·
Microsoft Expected To Post First Ever Quarterly Loss In Its History
- stephengillie 14y agoIt's not an article, just a blurb: (CBS/CNN) - Microsoft is in danger of reporting its first quarterly loss in the last 20 years. The world's largest software company will absorb a $6.2 billion dollar charge stemming from an online advertising service it bought in 2007. Analysts estimate Microsoft earned about $5.3 billion dollars in the quarter that ended in June, so that charge would send the company into the red.
- adventureful 14y agoIt'll actually end up being a tax benefit while costing them no actual red ink.
- huggyface 14y agoMicrosoft paid $6.2 billion in cash for aQuantitive. That asset is now worthless. That is very real red ink, even though the actual accounting for it is occurring years later. It is a massive squandering of assets.
- raverbashing 14y agoCan we say "congrats MS"!? A mix of desperation, and having no idea of what you're doing. Hats off for Steve Ballmer Goog payed 2B for DoubleClick right? Funny thing is that "everybody knew" who DoubleClick was, but I'd say it was hard to find someone to have hear about aQ before the acQuisition.
- Of_Prometheus 14y agoWhat a bitter comment. The fact that you believe someone with over two decades' worth of experience has no idea what he's doing illustrates just how seriously one should be taking your opinion.
- steve8918 14y agoNo. Writing down a loss on a purchased company is not a taxable benefit at all. They are writing off goodwill and intangible assets which were acquired when they purchased a company, and this has no tax consequences. Maybe if they wrote off tangible assets, they could accelerate the depreciation, but it's most likely that all of the write down is in goodwill and maybe intangible assets.
- _delirium 14y agoThere are some cases in which you can write off intangible assets as "abandoned", but it's complex. A brief bit discussed in these two articles: http://www.cbiz.com/page.asp?pid=8872 http://www.cbiz.com/page.asp?pid=8872, http://www.cbiz.com/page.asp?pid=8984 http://www.cbiz.com/page.asp?pid=8984
- rprasad 14y agoIt may provide a tax benefit offsetting the sales of Windows 8 this year, but it will definitely cost them a lot of red ink.
- randomdrake 14y agoMore information about this can be found in their press release [1] from a couple weeks ago. It appears that they are having to do a writedown [2] on their purchase of aQuantive [3]. The original purchase was to be more competitive in the online advertising marketplace when they lost out to Google in acquiring DoubleClick [4]. Unfortunately, there is little information about this will actually affect their financials. The single-sentence blurb from the source doesn't shed much light on the situation. [1] - http://www.microsoft.com/en-us/news/Press/2012/Jul12/07-02CorpNewsPR.aspx http://www.microsoft.com/en-us/news/Press/2012/Jul12/07-02Co... [2] - http://en.wikipedia.org/wiki/Write-off#Writedown http://en.wikipedia.org/wiki/Write-off#Writedown [3] - http://en.wikipedia.org/wiki/AQuantive http://en.wikipedia.org/wiki/AQuantive [4] - http://www.pcworld.com/article/131991/microsoft_to_buy_aquantive_for_6_billion.html http://www.pcworld.com/article/131991/microsoft_to_buy_aquan...
- Kwpolska 14y agoThey’ll have more of those with Windows 8.
- bunderbunder 14y agoThe news is somewhat less disastrous in that it's because Microsoft had to write down a purchase they made a while ago. So they didn't lose money this quarter so much as acknowledge that they had previously lost a lot of money and put that on their books this quarter. What's really disastrous, though, is Steve Ballmer's recent comments about how they are determined to compete with Apple on every single front, regardless of whether they have any other reason to be in that portion of the market. This aQuantive debacle is a result of Microsoft trying to do exactly the same thing with Google. With that statement, Ballmer indicated in no uncertain terms that he has learned absolutely nothing from that mistake.
- chimi 14y agoThe only initiative Microsoft should focus on for the next quarter is ridding itself of Ballmer.
- sharkweek 14y agoI'm curious who they'd tap for the job -- My money would be on someone high profile, but who that is would be nothing but speculation I suppose.
- noblethrasher 14y agoScott Guthrie please.
- untog 14y agoA good developer does not (necessarily) a good CEO make.
- noblethrasher 14y agoGuthrie has been a rising star in management for several years now. He's currently a VP.
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- carsongross 14y agoI am become Steve Ballmer, the destroyer of companies... Don't let the bean counters or sales guys run the company. Always the product guy.
- edwinnathaniel 14y agoSounds like a cargo cult: always X, don't ever think of anything else.
- antoko 14y agoI think that would just be cult. http://en.wikipedia.org/wiki/Cargo_cult http://en.wikipedia.org/wiki/Cargo_cult
- cubicle 14y agohttp://www.marketwatch.com/story/microsoft-performance-expected-to-be-strong-2012-07-18 http://www.marketwatch.com/story/microsoft-performance-expec... Analysts surveyed by FactSet Research estimate Microsoft MSFT +0.91% will earn 62 cents a share on $18.2 billion in revenue, compared with a profit of 69 cents a share, on sales of $17.37 billion, in the same period a year ago. [...] At Citigroup, analyst Walter Pritchard said that even with the huge writedown, he expects Microsoft to report results in line with expectations. Still, Pritchard said, in a research note, that there are “many moving pieces in the numbers” from Microsoft, and that the prospects for Windows 8 will be a big driver of how investors treat Microsoft over the next year. Microsoft shares rose 64 cents, or more than 2%, to $30.32 Wednesday, and the stock is up by almost 17% since the start of the year. I can't comment myself, due to lack of information. We'll all see in four hours.
- brudgers 14y ago>"Microsoft shares rose 64 cents" Thus, Ballmer became $213,281,913.60 richer.
- Of_Prometheus 14y agoAnd, yet, he has no idea what he's doing. /sarcasm
- cubicle 14y agoAnd then... For the quarter ended June 30, Microsoft reported a loss of $492 million, or six cents a share, compared with a year-earlier profit of $5.87 billion, or 69 cents a share. Whelp, there you go.
- sabat 14y agoSteve Ballmer is a used car salesman cast in the role of a CEO. These are the natural consequences.
- dkhenry 14y agoThis is more of an accounting trick then an actual problem. Normally a company would write down a bad asset over a series of quarters to help drive good will from investors. As MSFT is currently preforming very strongly I think they chose this route (The quarterly loss) so that subsequent quarters when they launch their new products , and more specifically the Microsoft surface. They have good comparison numbers.
- moron 14y agoIt's weird to me that aQuantive is apparently not viewed as a massive failure for MS, even though they paid billions in cash for it and it's now worthless. But not only that, it was supposed to make them more competitive in a big market and didn't do that at all. So from a lay perspective it seems like that should be a disaster for Ballmer and probably others at MS, but it's being met with an attitude of "yep, that happened, and it doesn't really mean anything".
- jmduke 14y agoThe hubris in some of these comments are incredible. I'm no fan of Microsoft, but wanton armchair criticisms aren't constructive in the least. Microsoft has a great number of flaws, and "hurf durf Ballmer is a dunce" doesn't really address any of them.
- CurtHagenlocher 14y agoMicrosoft Corp. today announced quarterly revenue of $18.06 billion for the quarter ended June 30, 2012. Operating income and loss per share for the quarter were $192 million and $0.06 per share.
- ars 14y agoSee also: http://news.ycombinator.com/item?id=4267946 http://news.ycombinator.com/item?id=4267946