Revenues and Earnings Flat for the Fourth Quarter

Factoring out a spike in investment income and other extraordinary items, Microsoft’s business was essentially flat in the fourth quarter of fiscal 2000 (ending June 30, 2000) when compared to the previous calendar quarter or to the comparable quarter of fiscal 1999. CFO John Connors predicted that revenue would continue to remain flat during the first quarter of fiscal 2001, but grow in later quarters. He anticipates an overall revenue increase of 15% during fiscal 2001, comparable to the 16% increase experienced during fiscal 2000.

Comparison to the Fourth Quarter of Fiscal 1999

Regardless of how one looks at the financials—as raw numbers or adjusted for one-time special events—Microsoft’s revenue and earnings from its core businesses (i.e., excluding investment interest) were flat.

Microsoft’s revenues for the fourth quarter of fiscal 2000 (Q4 FY00) were US$5.80 billion, a 0.7% increase over the same quarter a year ago. Sales in the South Pacific and Americas region contracted about 5%; sales in the Europe, Middle East, and Africa region declined about 4%; sales in the Asia region rose 21%; and OEM sales increased more than 5%. Net income and earnings per share (EPS) for the quarter were inflated by investment income and rose approximately 9% to US$2.41 billion and US$0.44, respectively.