From Seven Businesses to Five

Beginning in FY’07, which started July 1, 2006, Microsoft will report its finances in five business segments, as follows:

Business Division. This segment consists of the following:

• The former Information Worker segment, which includes Office, Project, and Unified Communications products
• The former Microsoft Business Solutions segment, which includes the Dynamics lines of business management applications.
• Exchange Server and related Client Access License (CAL) revenue, which was formerly counted in the Server and Tools segment.

Entertainment and Devices Division. This segment consists of the following:

• The former Home and Entertainment segment, which includes Xbox, consumer software (such as Encarta and games) and hardware (such as keyboards and mice), and TV platforms
• The former Mobile and Embedded Devices segment, which includes embedded platforms, such as Windows CE and Windows Mobile.

Online Services Group. This is the new name for the MSN business segment, which includes MSN and Windows Live Web sites and online services. The composition of this group is not changing.