Driven by strong PC sales, Microsoft beat Wall Street predictions today by posting quarterly earnings, excluding one-time gains, of $US2.09 billion, or 38 cents per share, up from $1.52 billion, or 28 cents per share from the same period last year.
Revenue for the first fiscal quarter ending September 20 totaled $5.38 billion, up 28 per cent from $4.19 billion in the same quarter last year.
Including a one-time gain of $156 million on the sale during the quarter of the MSN Sidewalk online guide, earnings per share for the quarter would have been 40 cents.
The software giant attributed the growth to strong PC sales, particularly in Asia. Corporate demand for Office 2000, Windows NT Server and BackOffice applications drove the sales, Greg Maffei, Microsoft's chief financial officer, said.
Sales are expected to continue to grow markedly in the next quarter as well, Maffei said.
Sales in the South Pacific and the Americas this quarter totaled $1.86 billion, up from $1.60 billion in the same quarter last year; sales in Europe, Middle East and Africa reached $1.18 billion, up from $894 million in the same quarter last year; in Asia, sales totaled $593 million, up from $325 million. OEM sales were $1.74 billion, up from $1.36 billion in the same quarter last year.
One analyst said an important indicator of Microsoft's long-term strength will be the reception of the release, expected later this year, of the long-awaited Windows 2000.
"They always beat expectations, but I'm interested in seeing what happens when they come out with Windows 2000," said Bonnie Brooks, primary analyst for business products for Creative Strategies. "That (release) is really going to be the telltale of where they are going to go."
Strong PC sales in general are being spurred on by continued PC price-slashing, she said.