Microsoft on Thursday announced higher fourth quarter profits but shares of the software maker slumped as sales fell short of analyst expectations and MicrosoftÃƒÂ¢Ã¢â€šÂ¬Ã¢â€žÂ¢s forecast of a weaker current quarter.
Redmond, Washington-based Microsoft said profit rose to $ 3.7-billion (U.S.) or 34 cents a share in the three months ended June 30 from $ 2.69-billion or 25 cents per share a year ago. The latest profit includes 5 cents a share of legal charges and 9 cents a share of tax benefits.
Excluding certain one-time items, Microsoft earned 33 cents. Analysts were expecting, on average, a profit of 31 cents a share, according to a poll by Thomson First Call.
Sales rose 9 per cent to $ 10.16-billion from $ 9.29-billion. Analysts were expecting sales of $ 10.17-billion.
For this quarter, Microsoft said sales will be $ 9.7 billion to $ 9.8 billion. That would fall short of the $ 9.92 billion average analyst estimate in a Thomson Financial survey. Earnings will be 29 cents to 31 cents a share. That forecast includes compensation costs and doesnÃƒÂ¢Ã¢â€šÂ¬Ã¢â€žÂ¢t compare with analystsÃƒÂ¢Ã¢â€šÂ¬Ã¢â€žÂ¢ estimates.
The shares fell 54 cents to $ 25.90 in extended trading. They rose 25 cents to $ 26.44 at 4 p.m. New York time in Nasdaq Stock Market composite trading and outperformed the Standard & PoorÃƒÂ¢Ã¢â€šÂ¬Ã¢â€žÂ¢s 500 Index last quarter for only the third period in the past 10.
Chris Liddell, who recently left International Paper Co. to become Chief Financial Officer at Microsoft, said that the company would return to double-digit revenue growth for the fiscal year to June 2006.