Microsoft revenues suffer as users wait for Windows 8 upgrade


Microsoft revenues suffer as users wait for Windows 8 upgrade

Cliff Saran

Microsoft has blamed lower-than-expected first quarter results on consumers and businesses delaying desktop software upgrades until after Windows 8 is launched.

For the three months ending September 30 2012, Microsoft reported revenues of $16bn. Q1 came in $1.3bn less than the same period last year.

The Windows & Windows Live division posted sales of $3.24bn, a 33% decrease from last year. Microsoft’s Business Division posted a 2% decline in 2012 Q1 revenue to $5.50bn, compared with Q1 revenues in 2011.

"The slowdown in PC demand ahead of the Windows 8 launch resulted in a decline in operating income,” said Peter Klein, chief financial officer at Microsoft. 

With Windows 8, Microsoft is attempting to stem the decline in PC sales, which will affect its lucrative Windows PC operating system (OS) revenue. Windows 8 represents a fundamental shift for Microsoft, which is moving away from providing software for traditional business PCs, to offering an OS that will run across tablets, laptops and desktop PCs.

Commenting on next week’s launch of Windows 8, Microsoft CEO Steve Ballmer, said: “Investments we’ve made over a number of years are now coming together to create a future of exceptional devices and services, with tremendous opportunity for our customers, developers, and partners.”

However, Microsoft's Server & Tools division reported $4.55bn in first-quarter revenue, an 8% increase from the same quarter last year driven by the launch of Windows Server 2012.

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