Revenue and Profit (Loss) by Business Segment

Beginning this quarter, Microsoft reports financial results in five business segments. (For details of how the new segments stack up against the seven former business segments, see “From Seven Businesses to Five” on page 32 of the Aug. 2006 Update.)

Client includes desktop OSs.

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

Server & Tools includes server platform software, such as Windows Server and SQL Server, developer tools, and support and consulting services.

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

Online includes Windows Live and MSN.

This chart shows revenue and operating income or loss for each business segment for Q1’07 and the same quarter a year ago. The last column shows the percentage change in revenue between Q1’07 and the same quarter a year ago. The row Corporate Expenses counts expenses that cannot be attributed to any single business segment, including legal expenditures and broad-based marketing and administrative expenses.