Five Businesses Steady into FY'08

Online services and new business investments were among the themes at Microsoft’s July 2007 Financial Analyst Meeting (FAM), an annual event in which company executives detail the past year’s financial performance and outline priorities for the next several years. As in past years, executives defended the company’s money-losing online and home entertainment businesses, noting that Microsoft’s past investments in enterprise software helped the company expand beyond its desktop roots. However, the company promised that the Xbox business, a significant drain on profits for the last six years, would become profitable in FY’08.

Enterprise Strength Fuels Newer Businesses

During Microsoft’s 2007 fiscal year, which ended June 30, the company’s three core business segments-Client (Windows desktop OSs), Business (Office, Exchange Server, and other business software), and Server and Tools (Windows Server, SQL Server, and other infrastructure software)-each exceeded revenue expectations expressed at last year’s meeting and contributed more than US$26 billion in operating profits.