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Five Businesses: Financial Overview

By Matt Rosoff [bio]
Posted: Aug. 21, 2006

The following is a chart accompanying an article published by Directions on Microsoft, an independent research firm focused exclusively on Microsoft strategy & technology. More samples of our content, as well as a list of upcoming articles and reports are also available.

Beginning in FY'07, Microsoft will report finances in five business segments.

Client includes desktop OSs.

Business includes Office, Office Live, Exchange, Dynamics, and other business software.

Server & Tools includes server platform software and developer tools.

Entertainment and Devices includes Xbox, consumer hardware and software, and mobile and embedded hardware and software.

Online includes Windows Live and MSN.

Corporate Expenses includes expenses, such as legal charges and companywide marketing efforts, that cannot be attributed to any one business segment.

The following chart shows FY'05 and FY'06 revenue and operating income (loss) in each business segment, which the company revealed when it announced the new business segments, plus Microsoft's revenue estimates for FY'07. (Microsoft does not estimate operating income or loss for each business segment.)

  FY'05 Revenue FY'05 Income (Loss) FY'06 Revenue FY'06 Income (Loss) Estimated FY'07 Revenue
Client 12,151 9.403 13,209 10,182 14,266 to 14,530
Business 13,520 9,116 14,488 9,675 15,792 to 15,937
Server and Tools 8,370 2,109 9,653 3,017 11,004 to 11,101
Entertainment & Devices 3,403 (607) 4,633 (1,337) 6,069 to 6,764
Online 2,344 411 2,299 (77) 2,460 to 2,552
Corporate Expenses N/A (5,871) N/A (4,988) N/A
Totals 39,788 14,561* 44,282 16,472* 49,700 to 50,700

All numbers in millions of U.S. dollars.

*Operating income does not include taxes, or gains and losses from investments.

 
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