Microsoft reports $6.66b Q1 net profit, Windows 7 'fastest selling OS in history'
By Ross Miller 
posted January 28th 2010 6:12PM
posted January 28th 2010 6:12PM
Microsoft's gotta be pretty happy with its second quarter results, especially after two previous quarters of somewhat downtrodden reports. The company's posting a record $19.02 billion in revenue, a 14 percent increase year-over-year. Net income / profit was $6.66 billion. Buoyed by all that is $1.71 billion in deferred revenue for Windows 7 pre-sales, which in laymen's terms means money the company made before the fiscal quarter began but couldn't then claim it because the product (Windows 7) hadn't yet been delivered to the consumer. Speaking of the platform, Microsoft is claiming to now have "the fastest selling operating system in history" with 60 million licenses sold. A much better way for the gang in Redmond to the start the year, so now let's see how the rest of 2010 plays out.
Congratulations, Redmond!
@Banksta3
A company with more than a %90 market share should do much more than double a company with roughly %5. Yes, it is a huge profit, but when compared to overall size of the corporation, far from blowing Apple away. It would also be interesting to see what kind of cash reserves Microsoft has compared to the robust coffers of Apple.
@dmgabe
Microsoft sells software, primarily.
They see a FAR FAR lower portion of the revenue from a PC sale than Apple does. Maybe Apple should cut their profit margins down to about $60-$100 per computer to match what MS gets?
MS has still managed to sell more copies of Windows 7 in 4 months than Apple has sold of all versions of OS X, combined, over the last 9 years.
@Banksta3
.. and @everyone. How about not comparing this with Apple's earnings for a change? Apple did well, MS did well. Which is awesome in this shit economy. Let's all be happy aaaaaight?
@loocas
hey guys do u liek gadgets?
@loocas
If the powers that be at Microsoft are reading this blog then I've got two things that I'd like to voice...
(1) The two copies of Windows Vista Ultimate I purchased did not deliver the ultimate experience that I was expecting based on what was promised. I'd like your organization to consider upgrading my two copies to Windows 7 Ultimate free of cost. I'd have taken you at your word again and upgraded myself but I am now out of work and times are tough at this end.
(2) With profits exceeding six billion dollars I'm wondering if you're adding to your sales staff in the Midwest? I'm currently located in Milwaukee, Wisconsin and have a bachelors degree in management information systems. If I can locate a good paying job that will allow me to take care of my family and leave a little bit in my pocket then I'll proceed with the upgrade myself...no worries.
I realize that I'll get flack for this post from my fellow engadget readers but when asked for help by others I've always been one to ask WWJD?
@loocas they must be in league with the DEVIL! 6,6,6
@DaveBach
What Would Jobs Do?
You seriously asking MS that?
@loocas window7 is (and hopefully winmo 7 too will be) a gamechanger, i have thoroughly enjoyed win7 till now
zune hd rocks and am looking forard to zune phone
dont get me wrong, i am not a ms fanboy, its just that things have been looking up on ms front lately!
@dmgabe
MSFT has over $30 billion in cash reserves compared to Apple's ~$8 billion.
@DirtyVegas
I agree. Apple, Nokia, and MS have all made whopping profits. Hell, even Moto turned a dollar.
We should be happy that technology is selling.
@dmgabe Thats because Microsoft doesn't sell $800 10" iPods and call them a "tablet"
@ryanthered
You might want to double check your figures, Apple had more than 39 billion in cash last time i checked.
I haven't seen any recent numbers for Microsoft.
http://www.businessweek.com/technology/ByteOfTheApple/blog/archives/2010/01/almost_40_billi.html
@dmgabe
To all those people that see this as some kind of attempt to bash Microsoft, you really are trying to hard. Both companies have turned amazing profits in the worst economy since these companies were founded. It is great to see them succeed, but would also be nice to see them pass some of that profit on to the customers in the form of savings. I would really like to see a little refund from the $3,000 I sent Apple earlier this month.
@loocas Now apple can shut its mouth.
@DirtyVegas
Can't up-rate that enough.
@Banksta3 You win! You mentioned Apple first!
Oh, and one more thing: demand for Windows 7 is high for just two reasons:
1. Vista sucked. Bad.
2. XP is getting really, really old.
@ryanthered The fact that Apple has so much in cash reserves just means that they aren't doing much R&D, nor are they investing. Any smart business will keep a reserve/saftey net, but at the same time reinvests its as much cash as possible to grow, instead of just sitting on it.
The fact that Apple has so much in resrves tells me that they don't know what their next step is.
@DaveBach
Nothing screams 'Hire Me' better then telling the company you are looking to get hired with by telling them their product sucks and you are going or have already stolen from them. I don't know why you're unemployeed. Hmm....
@Ordeith DUH! Could that be because it's bundled with 89% of the PC's sold?
I'd be interested to see the relationship between Windows 7 and Vista.. I have a feeling it's the fastest selling OS in history because people are so eager to cover up Vista. Windows 7 is pretty cool, I have it on my Mac.
I have a feeling most of the sales are upgrades from Vista. Would be fun to see some charts =)
@bullshitexpresscom
So was vista, and look how well it did. Windows 7 is a damn good OS that's why it's selling so well.
@(Unverified)
I don't know where all these sites are getting their information from, it looks like they're getting it from each other, so when the previous site reports something wrong every other after it follows.
when you check out the MSFT slides and go to page 7 it says they made 6.8b, not 6.66b.
unless I'm missing something here someone correct me if I'm wrong.
@lennie22
http://www.techcrunch.com/2010/01/28/microsoft-earnings/?utm_source=feedburner&utm_medium=feed&utm_campaign=Feed%3A+Techcrunch+%28TechCrunch%29
@Luxury Guy
There might be a reason for apples cash hording, fear of company takeover. A big cash reserve increases compays value to deter hostile takeovers, and its war chest to fight back.
Only reason I can think of for apple huge cash reserve. Not sure who would go for apple takeover. Microsoft can't for antitrust laws. Oracle might, but they have bought Sun, so wont happen for a while. HP? Doubtful. Theres hardly any synergy in combining mac and pc sales, especially as macs main selling argument is dissing windows.
Jobs is probably paranoid of losing apple, as he did once before, and keeps the cash for that reason. Some day the stockowners are going to start question the sanity of that cash register, and demand divident.
how bout w98se?
@Ordeith It's not fair . It's like comparing oranges to "apples"
@EM1
I think Microsoft having a finger on the pulse of their customers would be the first to agree that Windows Vista Ultimate fell short on customer expectations. Being honest with your feedback to a company that strives to be progressive I would consider to be a positive thing. Now what I didn't say is that the feedback needs to always be positive. The healthiest people and organizations tends to be those that can receive and work with constructive criticism.
As for stealing software...
The two systems that I bought Windows Vista Ultimate for are back to running Windows XP Pro. I had some issues networking a few of my Vista and XP Pro machines and since I didn't have additional Vista licenses the easiest thing to do was to reload XP Pro on the two machines that had been upgraded to Vista Ultimate. So in response to your piracy concerns...rest assured that I do not use, obtain, or condone stealing of software or anything for that matter.
@loocas I guess those smug "I'm a Mac" ads no longer work?
@loocas OK lets not get overly enthusiastic about this. I LOVE Win7. However when you have bathed in hog shit a shower is more refreshing then usual.
Similarly after Vista, 7 is like being dipped in honey and being cleaned by a dozen hot redheads. And no I did not mention the use of scrub brushes either.
(OK SP2 in Vista did make a difference. But still. Initial startup and time to an actually usable desktop was still insane on anything other then a quad core beast of a desktop.)
@ryanthered Your math is all wrong my friend. You need to catch up on your Business Week reading. Apple has almost 40 billion dollars in cash reserves.http://www.businessweek.com/technology/ByteOfTheApple/blog/archives/2010/01/almost_40_billi.html
@Banksta3
Note really. Apple had profits of $3.4B, v. $6.6B for MSFT. MSFT profits include almost $1.8 in deferred revenue for Windows 7. More importantly, MSFT Q results were driven by a MAJOR new product release. Something they do once every other year. Apple's results included no major product release. In fact, If you factor in the release of Windows 7, the plethora of low cost netbooks, the launch of Droid, the marketing of Verizon and MSFT aggressively going after Apple...it was a remarkable achievement what Apple pulled out.
Just compare Apple to Dell, HP, Sony and other hardware folks to see how tough the market was. Even Motorola did well, but not so well in their cell phone division. They made a money in other parts of their business. Nokia made their numbers because they cut cost, not because they grew...Apple grew almost 40% with no new major product.
The market value of Apple is around $180B v. $250B for MSFT. 10 years ago, Apple was worth $2B and MSFT was worth $250B. So Apple has added almost $180B in market value during that time. Remarkable!
@Banksta3
it's not hard to make an impressive profit when you lay off 17% of your employees.
@jaffreywali
while I agree with most of what you said, however Apple releases new products every year. The iPhone 3Gs was quite new in 2009, and contributed to Apple's record year. The iMac and the Macbook lines were refreshed as well. I think the only product line that wasn't refreshed in 2009 was the AppleTV.
@loocas .. I thought I'm the only person who still believe in those stories.. lol, that number still holds an eye-opener for some of us. Especially when you see it on a giant-tech company like windows.. lol. As for the post if windows 7 rocks? Of course they do... Details: http://bit.ly/windows-7-uber-details
$6.66 billion profit
hmm....... Just another reason to believe Microsoft is the devil??
@roryoconnor2012
No Balmer just made a deal with the devil.
Although I have considered a few deals myself
Hey Bill G, you owe me, because Windows 7 was my idea!
@roryoconnor2012
We've known that for a while now. It's just too bad they can't copy anything properly.
@roryoconnor2012
http://www.techcrunch.com/2010/01/28/microsoft-earnings/?utm_source=feedburner&utm_medium=feed&utm_campaign=Feed%3A+Techcrunch+%28TechCrunch%29
check the MSFT slides, Page 7, I can clearly see $6.8b, not 6.66....unless I'm reading it wrong, someone correct if I am.
@lennie22
The company reported $19.02 billion in revenue and diluted earnings of $0.74 per share, beating analyst expectations of revenues of $17.8 billion and $0.59 per share. Operating income was $8.51 billion, and net income was $6.66 billion.
looks like 6.66 to me
@Bill Gates lol
Not bad.
@Jonathan Ive
I'm liking the you're ingenuity for creating such a profile.
@dedparrot wot
@dedparrot
Indeed. Just taking a break before I begin working on fixing a certain device.
@Jonathan Ive I've just gotta say, I dont like how your beard goes around your whole head.
@Jonathan Ive
Has Steverino blown his brains out in embarrassment yet?
iPad. thought i'd mention it since someone else will anyway.
@dedparrot
The horror...