Microsoft's Earnings Mixed, Looks to Windows 7 for Rejuvenation

From DailyTech: With Apple reporting another record quarter and releasing new products, pressure was high for Microsoft's results. Microsoft just announced its earnings on Friday and at first glance they aren't pretty, representing another quarter of declining revenue.

The numbers appear very dire, with revenue, operating income, net income and diluted earnings per share dropping, 14%, 25%, 18% and 17%, respectively. However, appearances can be deceiving -- this drop was largely because Microsoft deferred $1.47B USD in revenue on Windows 7 Upgrade Option program and sales of Windows 7 to OEMs and retailers before general availability.

Adding back this deferred income, though, the results become a mixed bag. Revenue, at $14.39B USD (with the deferred income) still fell 4 percent year to year. However, this isn't as bad as the slide in past quarters. Further, earnings per share rose to $0.52/share, rising over 8 percent from last year, thanks, in part, to cost cutting.

Chris Liddell, chief financial officer at Microsoft emphasized this positive metric, stating, "We are very pleased with our performance this quarter and particularly by the strong consumer demand for Windows. We also maintained our cost discipline, which allowed us to drive strong earnings performance despite continued tough overall economic conditions."

Microsoft's stock rose over 5 percent on Friday, and maintained most of these gains, thanks to the positive side of the results and optimism surrounding Windows 7.

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