Tech giants Amazon and Microsoft reported their results yesterday, with both companies exceeding expectations for the quarter.
Microsoft however saw its earnings impacted by its $1.89 billion settlements with Sun and the European Commission. The company otherwise saw positive performance across its business units.
The company's new income was $1.32 billion, or $0.12 per share, on revenue of $9.18 billion for the third quarter of its 2004 fiscal year, ended March 31. That compares to net income of $2.14 billion, or $0.20 per share, on revenue of $7.84 billion in the year-earlier period, the company said.
This year's net income also includes an after-tax charge of $501 million for stock-based compensation expenses, Microsoft said.
Without the charges, Microsoft's earnings amounted to $0.34 per share, ahead of the $0.29 per share consensus estimate among analysts polled by Thomson First Call. Microsoft also exceeded its own January forecast of earnings per share between $0.23 and $0.24, including stock-based compensation expenses of about $0.05.
All of Microsoft's business segments met or exceeded the company's expectations, Microsoft CFO John Connors said. Overall corporate IT spending continues to improve and Microsoft expects healthy demand through the end of its fiscal year on June 30, he said.
As a result of its better-than-expected performance, Microsoft upped its forecast for its full 2004 fiscal year. The company now expects revenue to be between $37.8 billion and $38.2 billion.
Online retailer Amazon.com saw solid increases in earnings and revenue and exceeded expectations for those two areas in its first quarter.
Amazon credited its emphasis on lower prices and its ever-increasing selection of products for its strong showing in the quarter, which ended March 31, 2004.
Compared with 2003's first quarter, Amazon's net revenue grew 41 per cent to $1.53 billion. Excluding an $87 million benefit from foreign exchange rates, net revenue rose 33 per cent. The consensus estimate from analysts had been for revenue of $1.45 billion. Net income came in at $111.1 million. Pro forma net income was $97 million.