12 ms·
Microsoft Reports Record Revenue of $24.52 Billion in Second Quarter
- polyomino 13y agoWhat is Windows OEM Pro revenue?
- ChuckMcM 13y agoMy guess is its Lenovo's OEM business. Lenovo supplies a lot of Fortune 100 companies with laptops and they run Win7 Pro.
- Goopplesoft 13y agoOEM is their one time install version of windows (with switches). This is the license usually carried by most hardware retailers.
- forgotAgain 13y agoA clever way of not differentiating Windows 7 and Windows 8 revenue.
- Goopplesoft 13y ago> 3.9 million Xbox One consoles and 3.5 million Xbox 360 consoles. Is anyone else surprised by the sales numbers for the Xbox 360?
- polyomino 13y agoI think the 360 is going to be like the ps2 was last generation. An obsolete console with a surprising number of sales.
- JohnTHaller 13y agoGiven the huge (and growing) game library on the 360 that doesn't work on the Xbox One, it's hardly obsolete. I have two friends who just bought their first 360 in the last few months. They bought it over the One because (1) WAY more games (2) less expensive games, and (3) all our friends have one so lots of friends to play online with.
- canistr 13y agoTo echo this point, there are many people who take the PS2 approach of buying a console at the end of its lifecycle to take advantage of buying all used games or old games and rock bottom prices.
- pyrocat 13y agoThis is what I'm doing with the PS3. Looking to buy one right now so I can finally play (and own) all the PS3 exclusives that will only be available on PS4 via their subscription streaming service.
- sliverstorm 13y agoThey sold them "into the retail channel", which I think means retailers bought them. Microsoft probably tried to liquidate the rest of their Xbox 360 stock in light of the Xbox One, which could explain the large number.
- scholia 13y agoXbox 360 is supposed to continue alongside the Xbox One. It sold well in the US in the holiday season, according to NPD, and I'd assume it still appeals in many parts of the world where the Xbox One is just too expensive. Lack of compatibility is an obvious drawback but consoles usually are incompatible.
- adamnemecek 13y agoEven though I'm not really a gamer, for some time I was considering getting it for GTA V. In the end I didn't but I wouldn't be surprised if some people had done that.
- cshimmin 13y agoI did just that. Although I bought a pre-owned console.
- drglitch 13y agoThere are very few titles for Xbox One still, especially for Kinect. More importantly, all Xbox 360 games can now be found for very deep discounts, opening up a whole new category of customers who were previously priced out (EDIT: and game sales drive system sales)
- nostromo 13y agoGTA 5
- untog 13y agoThey actually released a new version of the 360 recently. Presumably it's cheaper to manufacture than the previous one, and it signals that they intend to sell both for at least some time yet.
- mtsmithhn 13y agoThe PS2 continued to sell very well after the PS3 arrived as well.
- ChuckMcM 13y agoNice. I wish they would break this out a bit more: > Bing search share grew to 18.2% and search > advertising revenue grew 34%. It echos what we're seeing in terms of more people using alternative search channels (which, on a per page view basis, increases revenue in those channels). But for me the interesting bit is that their revenue grew twice as fast as their market share. That could be because they have moved to a point where incremental share is entirely accretive to their revenue, or it can mean that they are getting more for their ads. That would help understand whether or not Google's CPC is going to go down a little or more than a little :-).
- spullara 13y agoThat sentence doesn't read like that to me. Their search market share is 18.2% and is not a growth number. Advertising grew 34% from some unspecified base.
- ChuckMcM 13y agoFair enough, the previous quarter they just said this : "Search advertising revenue grew 47% driven by an increase in revenue per search and volume." Google's CPC in their third quarter 2013 was down 4%. If the ratio holds then a 34% increase in revenue would translate into a 2.9% decrease in CPC. Of course that assumes they are trading traffic 1:1. Hence my curiosity. Google will announce in a couple of weeks and we'll get to see.
- ChuckMcM 13y agoAnd from Google "CPC ... decreased approximately 2% over the third quarter of 2013."
- Maarten88 13y agoA friend who used Bing advertising told me he got much better results per dollar compared to Adwords. Better conversion and lower costs. Regrettably, Bing has very low volume outside the US. On our company site, Bing referrals are less than 2% of Google.
- mtgx 13y agoHoliday season, Xbox One launch - it's much easier to make "revenue" off $500 hardware, than from $5 a month Office services. 4 million Xbox Ones is already an extra $2 billion in revenue, regardless of what the profit is. I expect their revenue to continue to increase a little bit in the next quarters (YoY), as they keep focusing on selling hardware. I don't think their profits will improve too much, and might even see a decline within a few quarters, as it gets harder and harder to sell Windows 8 licenses, since most people don't like it too much, enterprise customers don't like it, and they've just announced a year and a half before release that Windows 9 is coming next year, which is pretty crazy on their part. Android and iOS will also keep affecting the sales of PCs, and therefore the sales of Windows licenses, too.
- Mythrl 13y agoThey didn't announce Windows 9. Those were tech sites just reporting on rumours. And considering that the last couple OSes have been released on 3 year cycles, mid-2015 is exactly when you would expect Windows 9 to come out.
- Nate630 13y agoNice EPS @ $0.78 as well.
- Goopplesoft 13y agoYup the street had them at $0.67 http://www.nasdaq.com/symbol/msft/earnings-forecast http://www.nasdaq.com/symbol/msft/earnings-forecast Why did they release this after hours?
- immad 13y agopeople always release earnings after hours.
- drglitch 13y ago> Why did they release this after hours? All earnings/major news releases are pre/after hours in order to reduce volatility on the news. Look at pre/after hours spikes of anyone (including MSFT) releasing earnings to see the effect earnings have on stock. Netflix yesterday was also a good example.
- deleted 13y ago[deleted]
- ljd 13y agoLike many on HN, I'm not a fanatic MS guy (despite having a deep C# background) but I'm happy to see them do well this past quarter. They've only had a series of bad PR recently, epitomized by the CEO stepping down being the highlight story of the year. But this doesn't talk about specifics. Consumer devices? I don't really understand which product is doing so well for them? I know it's anecdotal but I still have yet to hear someone recommend a microsoft product in the last 6-12 months. The only people that bought their phone were people that bought because of price point. Can someone shed some light on what microsoft has been selling that everyone wants? I'm really curious now.
- spiderPig 13y agoWhat everyone wants? Xbox one. I liked the Surface Pro 2 too . Just wish it were a tad cheaper.
- evo_9 13y agoIf that's the case isn't Sony set to report similar profits? From what I've read the PS4 is outselling Xbox One pretty substantially (even though Xbox One is selling quite well). Can it really be attributed to XboxOne and Surface? I'm really curious too.
- BugBrother 13y ago>> Can it really be attributed to XboxOne and Surface? Hardly the Xbox One, consoles generally lose money on the hardware for year(s) after release. Otoh, the revenue was the record and not the profits? For that, more hardware certainly helps. Edit: polyomino has a point, it seems components + build are about the same as the sales price (but not including e.g. transports and profit for the shops selling them). Edit 2: What tanzam75 said.
- polyomino 13y agoThis generation, the xbox one hardware is being sold for profit. I think the ps4 as well, although with much slimmer margins.
- sgolestane 13y agoIt seems Microsoft (http://finance.yahoo.com/q/ks?s=MSFT+Key+Statistics http://finance.yahoo.com/q/ks?s=MSFT+Key+Statistics) is doing financially better than Google (http://finance.yahoo.com/q/ks?s=GOOG+Key+Statistics http://finance.yahoo.com/q/ks?s=GOOG+Key+Statistics) in every aspect. Microsoft also has a more diversified business so I wonder why Google still has a larger market cap.
- smackfu 13y agoMSFT has been flat for so long that no one wants to buy it.
- sliverstorm 13y agoThat seems silly, they pay dividends. I'm perfectly happy with flat, dividend-paying stocks.
- eps 13y agoWhat seems silly? 3% annually in dividents is below inflation level.
- sliverstorm 13y agoFed's target rate is 2%, and either way it's close. Also, you can be quite confident you will get that 3% return if the stock is flat. Much more than you can say for a 0.07%-return savings account. You wouldn't want to put all your money into a 3% dividend stock, but as part of a larger diversification? Solid choice IMO.
- nivla 13y ago>MSFT has been flat for so long that no one wants to buy it. What? You call this flat? [1] The dividend payout has gone up, the price has been rising. If you call that a flat and that there is no interest in it, then I am sorry for the following remark: You have no idea about stocks and stock markets! [1]http://www.google.com/finance?chdnp=1&chdd=1&chds=1&chdv=1&chvs=maximized&chdeh=0&chfdeh=0&chdet=1390515621962&chddm=49657&chls=IntervalBasedLine&q=NASDAQ:MSFT&ntsp=0&ei=epXhUujpCcf4sQfKIA http://www.google.com/finance?chdnp=1&chdd=1&chds=1&chdv=1&c...
- mmahemoff 13y agoUp 14% from $21.5B from a year earlier, which was also a record: http://www.microsoft.com/investor/EarningsAndFinancials/Earnings/PressReleaseAndWebcast/FY14/Q2/default.aspx http://www.microsoft.com/investor/EarningsAndFinancials/Earn... Key difference probably being Xbox launch.
- gtirloni 13y agoSo what's it? Xbox division is a loss leader and should be dumped or a revenue source? HN can't make its mind :)
- czr80 13y agoLoss leaders are sources of revenue, but not sources of profit.
- rbanffy 13y agoPeople should focus on profits, not revenue.
- BlackDeath3 13y agoI think the problem is that you seem to assume that HN has one mind.
- zanny 13y agoAzure is pretty good VPS, Skydrive is usable for anyone deep in the MS ecosystem, they still sell their VS, Office, and Outlook pretty much at market saturation. And they make more money per Android phone than Google. And more money per Android phone than per Windows phone.
- deleted 13y ago[deleted]
- jasonlgrimes 13y agoNow they can afford to buy some new tech. Cheaper than innovating weak product.
- gtirloni 13y agoMSFT has been in the position of buying pretty much anyone for a long time. I don't see how "now" fits here.
- taspeotis 13y agoI wish they'd buy: * Xamarin and polish the debugging, VS integration and Mono in general (maybe replace a lot of it with MS' .NET implementation? I can dream) * MvvmCross and polish it and put it into the .NET BCL * JetBrains (or just ReSharper) and give it a once over (performance- and code analysis-wise) and ship it with VS. * Maybe Digia for Qt to replace MFC (this one's kind of selfish since Qt is used in places Microsoft probably doesn't care for - maybe they could sponsor the Windows side). > Cheaper than innovating weak product. Aside from MFC I think Microsoft has fairly solid solutions to a lot of problems (Azure, Active Directory, Exchange Server, Visual Studio, Office, .NET).
- boyter 13y agoAgreed. I wish they would would buy Xamarin and make it easy to build C# MVC applications and deploy on Linux/BSD. Give me that with entity framework to MySQL/Postgresql and I am sold. Will convert over to using it for everything. Add in ReSharper and it has the potential to be the most productive environment on any platform.
- hawkharris 13y agoI'm a new investor who's learning about technology stocks. Will someone with a better understanding of the market explain what this news means to prospective investors?
- pyrocat 13y agoThat's not really HN's forte. You may have better luck over at the Motley Fool (http://www.fool.com/ http://www.fool.com/)
- hawkharris 13y agoThanks for the resource!
- thebouv 13y agoLike it or not, their services are pervasive in the enterprise. Office 365 is the future for so many Fortune 500 companies and Sharepoint 2013 is a huge push too. As much as I wish there was more Unix/Linux at my company, all eggs are in the MS basket for sure.
- bediger4000 13y agoThat pervasiveness seems like a double-edged sword. First, what if Microsoft really does lose it in a big way (rather than just remaining stuff, boring and unimaginative)? Enterprises will really be on the hook to find replacements, and to create portable versions of all that documentation that's in .doc and .docx format. Second, does "the enterprise" and "the rest of the world" divergence have any consequences? The Sharepoint thing is a good example. Everybody else uses Apache, nginx or something, but corporations use Sharepoint because it lets them keep a thumb on their employees. Won't any innovation made by The Rest of the World just pass them by? Will Sharepoint admins end up making the big bucks because there's no easy to find, off-the-street source of those folks?
- guelo 13y agoIf you look at the segments report[1] you'll find that the real drivers of the increase was Devices and Consumer Hardware, which was mostly driven by the Xbox launch, and Commercial Licensing. But the Gross Margin tells a different story. When you subtract the cost of making the Xbox consoles the D&C Hardware segment actually decreased from last year. The only real increase is Commercial Licensing, which is mainly Office and servers. [1] http://www.microsoft.com/Investor/EarningsAndFinancials/Financials/fy14/q2/SegmentRevenues.aspx http://www.microsoft.com/Investor/EarningsAndFinancials/Fina...
- camus2 13y agoDoes the licensing include the "Android Tax" ?
- Tloewald 13y agoAm I being overly cynical in 1) they bought nokia, 2) revenue != profit, 3) nokia sells a lot of cheap phones.
- kvb 13y agoYes, because the purchase hasn't closed yet, so those revenues aren't included. Also, there was near-record profit to go along with the revenue, so margins aren't down too badly.
- codex 13y agoMicrosoft is still milking slow to change enterprises. That is the main story here.