REDMOND, Wash. — July 21, 2005 —
Microsoft Corp. today announced revenue of $10.16 billion for the
quarter ended June 30, 2005, a 9% increase over the results in the same
period of the prior year. Operating income for the fourth quarter was
$2.99 billion, compared to $3.13 billion in the prior year. Operating
income for the fourth quarter includes $756 million related to legal
charges for antitrust-related claims. Net income and diluted
earnings per share for the fourth quarter were $3.70 billion and $0.34
per share, which included $0.05 of legal charges and $0.09 of tax
benefits. For the previous year, net income and diluted earnings per
share for the fourth quarter were $2.69 billion and $0.25 per share,
which included a $0.02 tax benefit. Operating income, net
income, and earnings per share amounts for the quarter and for the full
year include stock-based compensation expense. The company also
announced record revenue of $39.79 billion for the fiscal year ended
June 30, 2005, an 8% increase over the $36.84 billion reported last
year. Net income for fiscal year 2005 was $12.25 billion and diluted
earnings per share were $1.12, which included legal charges of $0.13
and tax benefits of $0.09. For the previous fiscal year, net income and
diluted earnings per share were $8.17 billion and $0.75, which included
legal charges of $0.17 and a tax benefit of $0.02. We closed out
a record fiscal year with strong revenue growth in the fourth quarter
driven by healthy, broad-based demand across all customer segments and
channels," said Chris Liddell, chief financial officer at Microsoft.
While continuing to invest in the business, we also returned $44
billion to investors through share repurchases and dividends during the
fiscal year. These results provide solid momentum heading into fiscal
2006, which is shaping up to be a strong year for growth and
investment. We expect double digit revenue growth next year, kicking
off the strongest multi-year product pipeline in the company’s history." Revenue
and operating income growth for the quarter were driven by continued
strength in the Server and Tools business. Rapid customer adoption of
Microsoft SQL Server product resulted in double digit revenue growth
of 16% over the same quarter of the prior year. This marks the third
consecutive year that the Server and Tools business has delivered
double digit revenue growth and improved profitability. Strong
results across all aspects of the Xbox business resulted in 22%
revenue growth for the Home and Entertainment division, providing a
great finish to an excellent year. In fiscal 2005 Home and
Entertainment shipped a record number of Xbox consoles and software,
doubled the number of Xbox Live members, and unveiled the Xbox 360
future-generation video game and entertainment system. Business Outlook Management offers the following guidance for the full fiscal year ending June 30, 2006: | • | Revenue is expected to be in the range of $43.7 billion and $44.5 billion. | | • | Operating income is expected to be in the range of $18.3 billion and $18.8 billion. | | • | Diluted earnings per share are expected to be in the range of $1.27 and $1.32. |
Management offers the following guidance for the quarter ending September 30, 2005: | • | Revenue is expected to be in the range of $9.7 billion and $9.8 billion. | | • | Operating income is expected to be in the range of $4.3 billion and $4.5 billion. | | • | Diluted earnings per share are expected to be in the range of $0.29 to $0.31. |
All figures include stock-based compensation expense and assume an effective tax rate of 32%. Webcast Details Microsoft
will hold an audio webcast at 2:30 p.m. PT (5:30 p.m. ET) today with ,
chief financial officer, and , corporate vice president and chief
accounting officer, to discuss details regarding the company’s
performance for the quarter and other forward-looking information. The
session may be accessed at http://www.microsoft.com/msft. The webcast will be available for replay through the close of business on July 21, 2006.
News Source: Microsoft Press Release
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