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Microsoft exceeds fourth-quarter profit expectations

Microsoft reported record fourth-quarter revenues of $17.4bn and profits of $6.2bn thanks to sales of it Office software and Xbox games console. The rise of eight and four per cent respectively exceeded projected analyst estimates but a lack of growth in the demand for its Windows operating system saw Microsoft fall behind its rival Apple.

Apple, Google and IBM also reported surprisingly healthy results for the same period with technology spending increasing despite the economic downturn in Europe and the US. However, Microsoft’s online department, which includes its search engine Bing, continued to haemorrhage money reporting losses of $728 million compared to $568 million two-years ago.

Revenue at Microsoft’s Windows division, which sells PC licenses, also decreased by one percentage despite the fact that PC sales rose by two per cent during the same period. Overall profits in the Windows division fell by $2.9bn, marking the second consecutive quarter decline.

In contrast, Microsoft’s Entertainment and Devices division made a $32m profit with revenue rising by thirty per cent to $1.5bn thanks to Xbox sales and the Windows Phone platform.

Overall, despite the downturn in its Windows division, Microsoft’s stock rose eight per cent over the last twelve months exceeding the projected figures put forward by market analysts.

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