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Microsoft FY2014 Q4 Earnings: Revenues Up, Profits Down Slightly
Microsoft has released their latest earnings report, and it's not as bleak as last week's news might have you suspect. Quoting Forbes: Microsoft reported $23.38 billion of revenue for the fourth quarter, up 17.5% from the same period last year. Net income, however, came in at $4.6 billion, down from last year and behind Wall Street analysts' consensus estimate, both about $5 billion. At 55 cents earnings per share were down 4 cents and a nickel short of the Street’s call. For the full year, revenue clocked in at $86.8 billion an 11.5% increase from a year earlier. Net income was $22.1 billion and earnings per share were $2.63.
They took a hit from finalizing the acquisition of Nokia's handset division (not unexpected). The cloud services side of the business appears to be growing, while traditional software sales have stagnated. The layoffs will cost Microsoft between $1.1 and $1.6 billion over the first half of next year.
They are taking on more and more hardware business. This is a much less profitable venture than they had before, so I don't expect things to be as rosy as you seem to. It is very hard to maintain the profit margins that they are accustomed to. Wall Street has given them a huge boost over the last year, but remember that comes after 10 years of no movement, and they still aren't anywhere near their highs during the dot-com bubble.
Still, the layoffs show that they are serious and PC sales have finally stabilized. While I am not a stockholder, I think you are right to be bullish in the short term.
W..w..W - Willy Waterloo washes Warren Wiggins who is washing Waldo Woo.
If you are tracking a company's performance by its stock price it's kind of laughable; share holders are a mentally unstable bunch, and unless you sacrifice your company for short term profits they really don't get excited. There is no long term outlook for companies any more, and MS' long term strategy I think, is getting stronger. The cutting of the 18k employees is just showing they are narrowing their focus and really concentrating on the areas they think will be big; cloud, and mobile.
And as somebody in the cloud space myself (for work), I look at Azure with great interest because of their investment into it. We are a huge Microsoft customer already, and we can leverage that size and contract for our benefit with Azure and licensing; Amazon can't beat them on that, and if I get the enterprise tools I want... it's a no brainer. AWS has a lot of features, but the vast majority of them aren't useful at this point for our needs... we need pure infrastructure, autoscaling, and database services -- all of which are available through Azure, and all of which are available for a lower cost.
The price is always right if someone else is paying.
There is sure to be a Dead Sea effect and MS's long-term prospects cannot be great if they have lost / will lose their best people
Microsoft has returned 100% in the past 10 years, dividends reinvested, or 7.25% annually. S&P 500 has returned 118% with dividends reinvested, or 8.2%.
Which, in my mind, makes them kind of equal. Microsft is now considered a value company , so lower risk and lower reward. Adjust for risk and it looks better. Also, chosing the past 10 years is kind of arbitrary - why not 7 or 12 years.
If you are tracking a company's performance by its stock price it's kind of laughable
What do you suggest then? A Ouija board? The stock price is the consensus opinion of people investing real money. If you are so much smarter than the market, you should have made billions by now taking highly leveraged contrary positions. Please post a picture of your yacht.
unless you sacrifice your company for short term profits they really don't get excited. There is no long term outlook for companies any more
Sure. That is why companies that invested for the long term, like Amazon, Google, and even Microsoft in their early days, were unable to raise capital, and have all gone out of business.
If you are tracking a company's performance by its stock price it's kind of laughable
I agree, but the poster to which I replied was bragging about how MSFT is doing so well and his stock portfolio is being counted by him and he is enjoying life. I merely pointed out that MSFT did not even perform better than the index.
Most companies are happy to turn a 10% profit after expenses, employees, and so forth. 20% is a fantasy for them.
Yet the greedy Wall Street pricks aren't happy with a 20% profit.
I do not fail; I succeed at finding out what does not work.
I went here: http://www.microsoft.com/inves...
They have a nice little drop-down to select year/quarter and links to financial statements...it's all right there
My problem is I don't know how to read this MBA/budget speak...
I looked at 2009, their xls "financials" info...Q4...
Saw the breakout by sector tab, but the categories were type of services (servers, 'client', etc) but couldn't see where there was a "Public Sector" or anything similar...couldn't find a category for type of client.
Also, I"m a bit miffed that my GP post was labeled "troll"...seriously...not trolling...trying to find out info here that we all, in our industry, should have some idea of...
Thank you Dave Raggett
I find it a bit ironic that Microsoft has helped usher in this huge digital age where none of us really want to "own" digital content any more. We don't rush out to buy CD's any more, we subscribe to music services or stream Pandora. We don't go out and purchase DVD's, we subscribe to Netflix or rent some viewing via iTunes.
Yet, despite some little things like Office 365, Microsoft still makes its bread and butter via selling software to OEM's and volume customers that runs on hardware, both of which many of us are increasingly not wanting to own. I f*cking hate installing an OS on a server and then making sure the damn thing stays running. I'd much rather rent the VM in the cloud. Even better, just let me subscribe to your web service.
----- obSig