Microsoft suffers first ever revenue drop

Posted on 24 Apr 2009 at 07:54

Microsoft has reported its first ever year-on-year drop in quarterly revenue, as the recession hit nearly all its business sectors.

The Windows maker’s revenue for the first three months of 2009 was down 6% on the same quarter last year, with profits taking an even bigger hit. The company’s previous worst performance was a 0.7% increase in mid-2000.

Chris Liddell, Microsoft’s chief financial officer, sees no grounds for optimism that the situation will improve any time soon.

“I didn’t see any improvement at the end of the quarter that gives me encouragement that we’re at the bottom and coming out of it.”

Microsoft’s online operations suffered most, with a 14% drop in revenue where analysts had expected a rise in sales. Chief executive Steve Ballmer’s oft-stated commitment to over-taking Google seems a distant dream at the moment.

Weak PC and server markets led to a fall in Windows and Office sales which the netbook boom could not offset, in part because Microsoft makes a lot less for each copy of Windows XP installed on a netbook that it does on laptop and desktop PCs.

The one bright spot was a 16% rise in revenues from the Xbox platform and PC gaming.

[photo: WEB DEVELOPERS by Nick, Programmerman; some rights reserved]

Author: Simon Aughton

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