PC boom boosts Microsoft revenue

Microsoft has reported a 19% year on year revenue jump but a lower net income as a result of equity compensation costs for its second financial quarter.

Net income for the quarter ending 31 December came to $1.55bn (£838m) including equity compensation expenses of $2.17bn. In the same quarter last year, Microsoft reported net income of $1.87bn, including various charges totalling $1.26bn.

Revenue amounted to $10.15bn, up from $8.54bn in the same period last year. In October, the software supplier estimated second-quarter revenue would be between $9.7bn and $9.8bn.

Microsoft attributed the higher than expected revenue to consumer and corporate demand for PCs that exceeded its expectations, resulting in double-digit sales growth for Windows XP and Office products. In the quarter, the corporate IT market began to show signs of a recovery, with increased demand for both desktop and server products.

Microsoft now expects its full 2004 year revenue to be between $35.6bn (£19.2bn) and $35.9bn.

For the quarter ending 31 March, Microsoft predicted its revenue to be between $8.6bn and $8.7bn.

Joris Evers writes for IDG News Service