Microsoft profits boosted by business spending

Microsoft profits boosted by business spending

Software giant Microsoft has reported a 51% rise in quarterly profits amid signs of a recovery in technology spending by big businesses.

Microsoft said an increase in sales to companies of the newest versions of its Windows operating system and Office software helped to make up for softer-than-expected revenues from sales of consumer PCs in the quarter.

For the first quarter of its financial year, Microsoft’s net income rose 51% to $5.4bn (€3.4bn), while revenues improved 25% to $16.2bn (€11.7bn). Microsoft beat expectations on both fronts.

Bill Koefoed, Microsoft’s general manager of investors relations, said the pick up in business spending coincided with recent product launches.

He added: “We ended up in this great sweet spot in business spending that was re-emerging after the downturn.”

Mr Koefoed expects the spending to continue for some time as companies are using more than 400 million PCs that are more than four years old.

Meanwhile, Microsoft’s online revenues, which come mainly from search advertising, rose 8% to $527m (€380m).

The segment widened its operating loss in the quarter to $560m (€404m) as the company continued to spend money on competing with Google, which is the sector’s leading search provider.

Microsoft’s comments about weaker consumer demand for PCs was in line with those by other technology firms, such as chipmaker Intel.

More in this Section

Concern for future of traditional advertising as high profile agency shutsConcern for future of traditional advertising as high profile agency shuts

Auctioneers call for end to 'archaic' property systemAuctioneers call for end to 'archaic' property system

Tech firm JRI formally begins roll-out of Tralee job expansion programmeTech firm JRI formally begins roll-out of Tralee job expansion programme

Primark to focus growth drive on US and PolandPrimark to focus growth drive on US and Poland


Lifestyle

Jim Murray is a guitarist, originally from An Muine Fliuch, Co Cork.A Question of Taste: Jim Murray, Guitarist

A consultant said it’s not ‘trigger finger’ and is looking into other possible conditions.Natural health: 'My middle finger is stuck at a slight angle'

If you're a gardener who follows astrology, you may be interested to know your garden could perform better if you plan your gardening schedule according to the path of the moon.Tuning into the cycles of nature is all part of lunar gardening

More From The Irish Examiner