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Microsoft revenue dips 1st time in 23 years

Source: PTI
April 24, 2009 16:44 IST
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Software giant Microsoft reported a decline in quarterly revenue for the first time in 23 years as adverse economic conditions globally took a toll on the entity's business.

Hit by plunging sales, Microsoft saw its profit plunge to a little below $3 billion for the third quarter ended March 31.

The software major posted a six per cent fall in revenue at $13.65 billion, the first of its kind since the company went public 23 years ago. In the year-ago period, Microsoft's revenue stood at $14.45 billion, the firm said.

The entity's third-quarter profit slumped 32 per cent to $2.97 billion. It had a profit of $4.38 billion in the year-ago period.

With the global economic turmoil hitting the personal computers and server markets, the software giant had a negative impact on various business segments, including 'Microsoft Business Division' and 'Server & Tools'.

Striking a gloomy note, the company's chief fnancial oficer Chris Liddell warned the 'eakness to continue through at least the next quarter'.

"While market conditions remained weak during the quarter, I was pleased with the organisation's ability to offset revenue pressures with the swift implementation of cost-savings initiatives.

"We expect the weakness to continue through at least the next quarter," Liddell said.

The third quarter results include severance charges to the tune of $290 million related to plan to slash 5,000 positions in the company. Microsoft also incurred impairments to investments worth $420 million.

For the nine months ended March 31, 2009, the company registered a profit of $11.52 billion against $13.38 billion in the corresponding period a year ago. During the same time, theĀ  entity's revenues touched $45.33 billion whereas the same stood at $44.58 billion in the year-ago period.

Meanwhile, Microsoft expects expenses to be in the range of $26.7 billion to $26.9 billion including severance charges for the full year ending June 30, 2009.

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