US software giant Microsoft had record revenue of $11.84 billion for the financial quarter that ended December 31, 2005, the company said last night.
The figure represented Microsoft's best single-quarter revenue to date and was a 9% increase over the same quarter a year earlier.
Earnings per share were 33 cents, as forecast, while net earnings were $3.65 billion, according to the company.
A company statement blamed a 2% drop in operating income on missed sales targets for the new Xbox 360 as well as marketing and product development expenses associated with major product launches.
'The growth in our core businesses was healthy during the quarter, driven by strength in Server and Tools and the success of our Windows Client products in a robust PC market,' Microsoft chief financial officer Chris Liddell said.
'The quarter also marked the beginning of an important product cycle for Microsoft with the launches of Xbox 360, SQL Server 2005, Visual Studio 2005 and Microsoft Dynamics CRM 3.0, all of which were extremely successful and well received by our customers,' he added.
A large number of Xboxes were sold since the new generation was released last year, but not the number Microsoft expected, Liddell said. He said that Microsoft had resolved 'issues with components' that hampered production of Xbox consoles. Microsoft had contracted another company to manufacture the games, Liddell said.
For the first time, all Microsoft divisions aside from the home entertainment unit showed a profit. Net income for the quarter was $3.65 billion, a 5% increase from the same quarter a year earlier, according to Microsoft. Server and Tools division revenue grew 14% from the prior year while SQL Server revenue rose a 'robust' 20%, the company reported.
Microsoft returned more than $8.5 billion to shareholders in the form of dividends and share repurchases during the quarter, the company reported.
The company forecast revenue in the next quarter would range from $10.9-11.2 billion and earnings per share would be 32 or 33 cents. Operating income was predicted to total from $4.5-4.6 billion. Microsoft expected to end the current fiscal year with revenue in the range of $44-44.5 billion and earnings per share of between $1.28 to 1.31.
