Microsoft Quarterly Revenues Fall For First Time Since 1975

In what could be seen as an end to one of the most inspiring growth stories in contemporary businesses, Microsoft Corp. has posted a drop in its quarterly revenues for the for the first time in last 23 years.

The world’s largest software maker has been hit hard by slumping demand for software for consumers as well as businesses amid frosty economic environment.

For the quarter that ended on 31 March, the software giant posted revenues worth $13.65 billion, down by 6 percent from $14.45 billion posted for the same period a year ago. Moreover, the revenues have been around $500 million below what analysts had forecasted.

Net income for the same quarter plunged 32 percent to $2.98 billion, from $4.39 billion. However, Microsoft’s PC operating systems tumbled significantly by 16 percent to $3.4 billion, and its internet division saw a revenue drop of 14 percent to $721 million.

However, after excluding the recent layoff costs and charges for impaired investments, the company has managed to post a profit of 39 cents per share.

Furthermore, the software company, which withdrew its profit predictions in January owing to the ongoing economic situation, pointed out that the weaknesses in its sales to continue for at least the quarter ahead.

Along the same line, Microsoft’s chief financial officer Chris Liddell mentioned, “We didn’t see any improvement at the end of the quarter that gives me encouragement that we’re at the bottom and coming out of it”.

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Our Comments

Even if Microsoft revenues fell down for the first time in the company's history, the software company managed to baffle analysts by posting a surprising 3.9 percent rise in pre-market transactions, after the close. This goes to show that we are currently living in exceptionally dire times which are not sparing anyone, including the mightiest.

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