Ina Fried

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Microsoft: We’re So Excited About Windows 8, We Can Hardly Speak

Microsoft isn’t expected to give a firm ship date for the next version of Windows, but it did use language in its earnings release suggesting it expects big things for 2012 due to Windows 8.

So far, Microsoft has committed only that the operating system will hit beta in February, though it is widely believed by the industry that the software should show up on new PCs later this year.

We’ll see what language Microsoft uses about that and other topics when its earnings conference call kicks off momentarily.

Earlier:
2:32 pm: Call kicking off now.

CFO Peter Klein maintains Microsoft did well despite a challenging quarter. First mention of “big launch year.”

2:33 pm: Business software doing well, Klein said, as is Server and Tools unit.

Windows Server 8 and new versions of other business software promised for this year.

As usual, Microsoft is more forthcoming about its server software schedule than it is on the desktop side.

2:36 pm: On search, the company saw some increase in revenue per search and says it will work hard to continue that.

2:36 pm: Xbox 360, as noted at CES, had a record holiday season.

2:38 pm: On to a financial recap. Enterprise bookings strong. Unearned revenue (a key measure of future sales) was $15.3 billion.

PC market was rough due to several factors including demand and a hard drive shortage. PC sales to emerging markets continues to be stronger than in developed markets, which hurts Microsoft’s sales and bottom line as it gets less per PC from both piracy and lower selling prices.

Consumer PCs down 6 percent on weak netbook sales. Netbooks, which were 8 percent of the PC market a year ago, are now just 2 percent of the market.

2:41 pm: Microsoft saw double digit increases in its Dynamics unit, which competes against Salesforce and Oracle in business software market for small and mid-size businesses.

2:45 pm: OK, talking online services.

Online ads up 13 percent. Search revenue up per search and overall.

2:47 pm: On Windows Phone, lots of adjectives and superlatives about new phones. No new interesting numbers.

2:52 pm: Despite challenging quarter, “We have the strongest product pipeline we have ever had,” Microsoft insists.

2:53 pm: On to Q and A.

2:54 pm: Nokia payments were among the factors that led to a higher cost of goods sold during the quarter. Other big impact was just the fact that the company sold a ton of Xbox consoles, which have lower profit margins than software.

2:56 pm: Impact of hard drive shortage on PC industry expected to continue into this quarter.

3:01 pm: Asked about Windows 8 impact on PC inventories, etc. ahead of launch.

“It’s probably premature to talk about that.”

Sigh.

3:02 pm: Microsoft shares, by the way, are up in after-hours trading. They are at $28.88, up 76 cents or about 2.7 percent.

Not a ton of exciting info coming out of Q and A.

3:06 pm: Asked about impact of ultrabooks, Microsoft says it points to the opportunity that remains in PC market, but doesn’t give much of what impact it expects on pricing, sales, etc.

3:09 pm: Last question is on Windows 8, but no new details.

“We’re on track. We feel really good about where we are.”

And, that’s it.


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The problem with the Billionaire Savior phase of the newspaper collapse has always been that billionaires don’t tend to like the kind of authority-questioning journalism that upsets the status quo.

— Ryan Chittum, writing in the Columbia Journalism Review about the promise of Pierre Omidyar’s new media venture with Glenn Greenwald