Microsoft reports strong Q4 revenue thanks again to Windows 7 sales

Microsoft announced on Thursday, a record fourth-quarter revenue of $16.04 billion for the quarter ended June 30.

The financial figures are a 22% increase from the same period of the prior year. Microsoft says this revenue growth was driven by a strong performance from Windows 7, which has sold more than 175 million licenses to date. “This quarter’s record revenue reflects the breadth of our offerings and our continued product momentum,” said Peter Klein, chief financial officer. “The revenue growth, combined with our ongoing cost discipline, helped us achieve another quarter of margin expansion.”

Analysts polled by Thomson Reuters were expecting the software giant to report a profit of $0.46 per share on revenue of $15.26 billion, Microsoft beat these expectations with $16.04 billion and profit of $0.51 per share. Kevin Turner, chief operating officer, said the revenue was down to strong sales in the enterprise with Windows 7 and Office 2010. "“Our transition to cloud services is well underway with offerings like Windows Azure and our Business Productivity Online Services, and we look forward to continuing our product momentum this fall with the upcoming launches of Windows Phone 7 and Xbox Kinect," said Turner.  

Windows 7 was released nine months ago today, on October 22, 2009. The OS originally released to manufacturing one year ago. Microsoft announced that Windows 7 is the fastest selling operating system in history, selling over 175 million licenses to date. The company is projected to sell 300 million by the end of 2010.

Microsoft's success with Windows 7 began before the product was even widely available. Released in October 2009, the operating system has received praise from consumers, businesses and the media. In November 2009, Windows 7 managed to surpass Apple's Snow Leopard market share in just two weeks. In early February it was revealed that Windows 7 had reached 10% market share in just three months.

Windows 7 has also driven an uptake of 64-bit computing. According to ChangeBASE research, conducted with senior IT decision makers, more than 65% of businesses hoped to migrated to Windows 7 within 12 months of its release. Over 50% of those migrating will be choosing the 64-bit route. Microsoft confirmed earlier this month, that nearly half of all Windows 7 PCs run 64-bit versions.

Screenshots of a Windows 7 post RTM build showed up on the web in February, fueling speculation that Microsoft is compiling early Windows 8 builds. The successor to Windows 7 will likely be available in 2011 as an ex-Microsoft worker penned July 2011 as the RTM date for Windows 8. Microsoft is expected to build a 'Windows Store' app store into Windows 8 and Kinect-like functionality.

Microsoft is currently readying its first Service Pack for Windows 7. A public beta version was made available recently with a final release expected in the first quarter of next year.

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18 Comments

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Well this definitely shows off Apple because they only brought in 3 or 4 billion on the quarter but then again Apple is a smaller company but still really shows who is boss and Straf is right sales will jump in the next 2-3 months with all the new line of 2010 and server software out.

Yeah they are kicking goals with a lot of things lately. Windows 7, Windows Server 2008 R2, SQL Server 2008 R2, Sharepoint 2010. Not too sure about Office 2010, I like it but there is not much of uptake as much as it was with 2007.

wrack said,
Yeah they are kicking goals with a lot of things lately. Windows 7, Windows Server 2008 R2, SQL Server 2008 R2, Sharepoint 2010. Not too sure about Office 2010, I like it but there is not much of uptake as much as it was with 2007.

That may just have to do with the time of year that Office 2010 was released. Office 2007 came out just at the end of summer, and Office 2010 came out just after classes ended. I'd expect better sales within a month or so

wrack said,
Yeah they are kicking goals with a lot of things lately. Windows 7, Windows Server 2008 R2, SQL Server 2008 R2, Sharepoint 2010. Not too sure about Office 2010, I like it but there is not much of uptake as much as it was with 2007.

Some of the nifty features of Office 2010 such as the new social aspects are also available for Office 2003 and above, it will be nice to drive the value of the feature since it's hard to benefit when everyone is using incompatible tools but those features probably won't be driving upgrades.

thealexweb said,
The BBC portrayed this story a bit weirdly http://www.bbc.co.uk/news/business-10733851. They mention "strong sales from its Bing search engine" but as far as I'm aware Microsoft's online division has never made a profit.

First of all, what you're aware of may not be true now, and second, even if they didn't make a profit, it doesn't mean they didn't do strong sales

spenser.d said,

First of all, what you're aware of may not be true now, and second, even if they didn't make a profit, it doesn't mean they didn't do strong sales

Well last year it lost a $1bn, I don't think they'll have been a massive turn round.

Why am I not mentioned in this article? After all, Windows 7 was my idea Seriously though, congratulations MSFT. I still wish I'd bought stock way back when.

zkid2010 said,
Why am I not mentioned in this article? After all, Windows 7 was my idea Seriously though, congratulations MSFT. I still wish I'd bought stock way back when.

When? 15 yrs ago?

Windows 7 was released six months ago today, on October 22, 2009.

6 or 9 ?????? corrections Tom

Edit: resolved.

still1 said,
Windows 7 was released six months ago today, on October 22, 2009.

6 or 9 ?????? corrections Tom

Huh? Tom means it hit the GA stage on October 22nd. It RTM'd in July, on the 22nd as well.

Paulz0r said,

Huh? Tom means it hit the GA stage on October 22nd. It RTM'd in July, on the 22nd as well.


actually he quoted it wrong "released six months ago" and it should be 9 months ago and he corrected it now.

well the thing is 7 rocks...

Not a surprise - Windows 7 is just about everything I love about Microsoft (and yeah, I do hate a lot too by now).

Breach said,
Not a surprise - Windows 7 is just about everything I love about Microsoft (and yeah, I do hate a lot too by now).

Don't be a hater.