Microsoft said yesterday that a surge in first-quarter sales was not sustainable and forecast tough business conditions ahead.
"We're not trying to say that we think the sales results of our first quarter will be sustainable. It is kind of a one-time anomaly," Microsoft chief executive Mr Steve Ballmer told Australia's Nine Network.
"We're still seeing the business as being reasonably tough, at least compared to, let's say, the good old days, reasonably tough around the globe."
Microsoft, the world's largest software maker, said last week it had doubled September-quarter earnings and raised its full-year revenue and earnings outlook. The result, which topped cautious Wall Street estimates, was boosted by new subscription-style licensing that encourages corporate customers to pay yearly fees for software. Microsoft said last week its balance of unearned revenue could trend lower over the next few quarters following the initial surge caused by last-minute and new license sign-ups. Unearned revenue is revenue that has been booked but not yet recognised as income.
Mr Ballmer also hinted Microsoft was unlikely to partner with Mr Rupert Murdoch's News Corp for a second stab at satellite television provider Hughes Electronics.
"A lot of our strategic interests have shifted since the deal fell apart the first time," Mr Ballmer, who visited Australia last week to shore up relations with major corporate clients, told Nine's Business Sunday programme.
News Corp and Microsoft lost the initial bid for Hughes and its DirecTV business earlier this year, but analysts say Mr Murdoch's media empire may make a second attempt after the rival bid from EchoStar Communications ran into opposition from US government agencies.
- (Reuters)
