Good news for Microsoft; beats the street again

By Richi Jennings (@richi ) - October 21, 2011.

Steve Ballmer (Der Tommy @ Picasaweb)
'Stodgy old' Microsoft (NASDAQ:MSFT) has announced its first-quarter earnings, and it's making more money than analysts expected. Again. In Q1, revenue up 7%, net income up 6%, and EPS up 10%. In IT Blogwatch, bloggers express grudging admiration for Redmond under Steve Ballmer.

Your humble blogwatcher curated these bloggy bits for your entertainment.

    Joab Jackson reports:

Microsoft reported first-quarter revenue of US$17.37 billion, beating the consensus estimate. ... Net income for the quarter...was $5.74 billion, or $0.68 per share, in line with...estimate[s].

...

The...Business Division...reported $5.62 billion in revenue, an 8 percent increase from the prior year...which itself benefitted from the release of Office 2010. ... [S]erver software -- including Lync, SharePoint, and Exchange -- enjoyed double-digit growth. ... Windows, grew...[by] 2 percent.   
M0RE

   Jolie O'Dell adds:

Diluted earnings for shareholders...[up] 10 percent.

...

While the company hasn’t revealed any specifics...it did say that [Bing] was rapidly gaining market share, growing 350 basis points. ... As for [Windows Phone]...Microsoft isn’t trumpeting any big numbers just yet.   
M0RE

Mary Jo Foley digs into the Microsoft Business Division numbers:

Ninety percent of MBD revenues come from Office products. ... MBD revenues were up primarily due to sales of the 2010 Office system.

...

Microsoft isn’t releasing separate sales data... [b]ut officials did say Office 365 is paving way for increased sales of Lync, SharePoint, & Exchange by customers of all sizes. ... [T]he implication is that sales of the...cloud products and the...on-premises products are reinforcing one another. And that’s an interesting trend...given the doubts...that users still wanted on-premises versions...and not simply cloud-only variants.   
M0RE

And Peter Bright opines, "All in all, it was a strong quarter":

Sales of traditional PCs to consumers were up sharply, by 14 percent. However, these gains were offset by a similarly sharp reduction in sales of netbooks, a market that Microsoft says is being "cannibalized."

...

Windows Server and System Center both experienced "double digits" growth, SQL Server revenue increased by almost 20 percent, and Enterprise Services revenue grew by 17 percent.

...

Perhaps the biggest concern is the performance of the Windows division. ... Though unstated, the poor netbook performance is a result of strong tablet sales, and Microsoft won't have a credible tablet operating system until...Windows 8.   
M0RE

Meanwhile, Preston Gralla criticizes Steve Ballmer (I know, hard to believe, isn't it?)

Microsoft CEO Steve Ballmer proved once again he's the master of hyperbole. ... [H]e said that Android was a difficult-to-learn-operating system. ... That's likely news to the people who use Android phones.

...

[I]t's time that he realized that bluster does Microsoft no good. Few people take him seriously any more...having people tune out your CEO isn't the best way to help your company [compete] against Google and Apple. He'd do better to highlight Windows Phone 7's unique capabilities -- and there are many of them.   
M0RE

 
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Richi Jennings, your humble blogwatcher

Richi Jennings is an independent analyst/consultant, specializing in blogging, email, and security. He's the creator and main author of Computerworld's IT Blogwatch -- for which he has won American Society of Business Publication Editors and Jesse H. Neal awards on behalf of Computerworld. He also writes The Long View for IDG Enterprise. A cross-functional IT geek since 1985, you can follow him as @richi on Twitter, pretend to be richij's friend on Facebook, or just use good old email: itbw@richij.com. You can also read Richi's full profile and disclosure of his industry affiliations.

Copyright © 2011 IDG Communications, Inc.

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