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Vista, Office Spur Microsoft to Huge Growth

23% gains in first quarter; new PC sales drive gains

By Colleen Barry,  Newser Staff

Posted Oct 26, 2007 3:10 AM CDT
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(Newser) – Microsoft yesterday reported a 23% leap in net income and its best revenue growth since the dot-com boom, making it an isolated winner in a tumbling market. The announcement drove up the company's shares 10% in after-hours trading. The sales of new PCs with Windows installed helped drive the gains, especially in developing countries creating large new markets for computers.

Although Windows Vista earned less than rave reviews, demand for it and Office remain strong—quarterly sales in the Window division jumped 27%. Microsoft still lags far behind Google and other Internet companies in growth from online advertising, and it faces a long-term threat as Internet services that emulate some of the functions of Office threaten to woo software customers away.

In this photo supplied by Microsoft, Microsoft CEO Steve Ballmer demonstrates the new Windows Mobile powered Sprint Touch during his keynote address at the Cellular Technology Industry Association (CTIA) conference in San Francisco, Oct. 23, 2007. (AP Photo/Microsoft, Lou Dematteis)
In this photo supplied by Microsoft, Microsoft CEO Steve Ballmer demonstrates the new Windows Mobile powered Sprint Touch during his keynote address at the Cellular Technology Industry Association (CTIA)...   (Associated Press)
Microsoft Corp. founder Bill Gates smiles during a launch announcement at the Unified Communications Server 2007 conference in San Francisco, Tuesday, Oct. 16, 2007. Microsoft Corp. launches programs that allow computer users to place calls right from Outlook and other Office applications, but analysts say the software maker must prove...
Microsoft Corp. founder Bill Gates smiles during a launch announcement at the Unified Communications Server 2007 conference in San Francisco, Tuesday, Oct. 16, 2007. Microsoft Corp. launches programs...   (Associated Press)
Microsoft Corp. Chairman Bill Gates speaks in this Feb. 26, 2007 file photo in Seattle.
Microsoft Corp. Chairman Bill Gates speaks in this Feb. 26, 2007 file photo in Seattle.   (Associated Press)
A Microsoft Windows Vista advertisement on display at Best Buy in Mountain View, Calif., Monday, Sept. 17, 2007. Microsoft lost its appeal of a European antitrust order Monday that obliges the technology giant to pay a record $613 million fine, share communications code with rivals and sell a copy of...
A Microsoft Windows Vista advertisement on display at Best Buy in Mountain View, Calif., Monday, Sept. 17, 2007. Microsoft lost its appeal of a European antitrust order Monday that obliges the technology...   (Associated Press)
A Costco warehouse customer walks next to Microsoft Vista on display at a Costco store in Mountain View, in this March 6, 2007 file photo. The EU's Court of First Instance on Monday Sept. 17, 2007 dismissed Microsoft Corp.'s appeal against an EU antitrust order that ordered it to...
A Costco warehouse customer walks next to Microsoft Vista on display at a Costco store in Mountain View, in this March 6, 2007 file photo. The EU's Court of First Instance on Monday Sept. 17, 2007 dismissed...   (Associated Press)
Windows Vista helped spur Microsoft to huge first-quarter earnings.
Windows Vista helped spur Microsoft to huge first-quarter earnings.   (Getty Images)
Stacks of copies of Halo 3 for the Xbox 360 are prepared for the midnight release of the game at the Best Buy store in Bellevue, Wash., in this September 24, 2007 file photo. Microsoft Corp. reported huge first-quarter earnings yesterday. (AP Photo/Marcus R. Donner, file)
Stacks of copies of Halo 3 for the Xbox 360 are prepared for the midnight release of the game at the Best Buy store in Bellevue, Wash., in this September 24, 2007 file photo. Microsoft Corp. reported...   (Associated Press)
Facebook.com's mastermind Mark Zuckerberg smiles at his office in Palo Alto, Calif. in this Feb. 5, 2007 file photo. Rapidly rising Internet star Facebook Inc. has sold a 1.6 percent stake to Microsoft Corp. for $240 million, spurning a competing offer from online search leader Google Inc. The...
Facebook.com's mastermind Mark Zuckerberg smiles at his office in Palo Alto, Calif. in this Feb. 5, 2007 file photo. Rapidly rising Internet star Facebook Inc. has sold a 1.6 percent stake to Microsoft...   (Associated Press)
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COMMENTS
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Spectacular earnings will pull in investors
BusinessWeek

Facebook deal was 'must win' to keep up with Google
Chicago Tribune

Why did Microsoft pay so much for part of Facebook?
Time

Microsoft gives up on European anti-trust cases
AFP

 
Google • Microsoft • Microsoft Windows • earnings reports • Microsoft Vista • software • Xbox 360 • Microsoft Office • Halo 3 • Microsoft Live Search • Google Apps • Internet advertising • computer

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