Microsoft’s decline in profit is less than analysts expected
SEATTLE — No one was expecting big things from Microsoft in its most recent quarter, but its results ended up being far less grim than the worstcase scenarios predicted for the company.
Microsoft said its profit fell about 12 percent while revenue rose 6 percent.
The lackluster results for the company’s fiscal third quarter, which ended March 31, stemmed from a combination of factors, including foreign currency fluctuations that crimped overseas sales and unflattering comparisons to last year’s results. Last year, Microsoft phased out technical support for its old Windows XP operating system, resulting in a temporary flurry of shopping for new software by customers.
Then there are the deeper issues with the PC market, which is suffering from a gradual multiyear descent to new sales lows. Microsoft is working on a new operating system, Windows 10, expected out later this year, that could give PC sales a lift.
It also dreams that Windows 10 will improve its fortunes in the highgrowth smartphone business and promising new markets like augmentedreality headsets. CEO Satya Nadella has been investing in new services and redesigning Microsoft’s most popular programs for smartphones and other mobile gadgets.
For now, Microsoft is in a lull, as its numbers showed. The company reported net income of $4.99 billion, or 61 cents a share, down from $5.66 billion, or 68 cents a share, in the same period a year ago.
Revenue rose to $21.73 billion from $20.4 billion a year ago, Microsoft said. Wall Street analysts were especially pleased that Microsoft exceeded its profit forecasts.