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Microsoft reported a 2.7 percent increase in overall revenue thanks to a small boost from Windows 8

Windows 8 didn't hit the ground running the way Microsoft thought it would after the October 2012 release, but it did offer a small boost in the company's latest financial earnings report.

For the quarter ended December 31, 2012, Microsoft reported a 2.7 percent boost in revenue to $21.5 billion from $20.9 billion in the year-ago quarter. However, the Windows maker saw a 3.7 percent drop in profit to $6.38 billion (76 cents a share) from $6.62 billion (78 cents a share) one year ago.

Microsoft saw a revenue increase of 24 percent in its Windows division to $5.88 billion (or 11 percent when adjusted for early sales of Windows 8) for the second quarter, which was the first to include Windows 8.

Microsoft didn't offer sales figures for its first homemade tablet, Surface with Windows RT. The new version -- Surface with Windows 8 Pro -- is expected to hit store shelves on February 9.

“Our big, bold ambition to reimagine Windows as well as launch Surface and Windows Phone 8 has sparked growing enthusiasm with our customers and unprecedented opportunity and creativity with our partners and developers,” said Steve Ballmer, CEO at Microsoft. “With new Windows devices, including Surface Pro, and the new Office on the horizon, we’ll continue to drive excitement for the Windows ecosystem and deliver our software through devices and services people love and businesses need.”

Windows 8, which was released in late October 2012, was met with plenty of criticism for its massive redesign. However, many PC makers (such as Dell) were hoping that it'd be the saving grace for the PC market, where hardware sales had been declining over the years as mobile devices (smartphones and tablets) exploded onto the scene.

But many PC makers didn't see a huge increase in sales with Windows 8. And while Microsoft hasn't released sales figures for its Surface tablet yet, reports last month indicated that the new device took a sales hit due to a lack of distribution. Microsoft had only offered the Surface with Windows RT online and at Microsoft stores (and there are a little over 60 stores total in the U.S.).

In mid-December, Microsoft finally allowed third-party retailers to sell the Surface. Surface with Windows RT also made its way to Australia in mid-December, and will do so in other countries in the following months.

Earlier this month, Microsoft announced that 60 million Windows 8 licenses were sold. However, 60 million licenses sold doesn't mean that there are 60 million Windows 8 devices out there.

In today's financial earnings report for Q2, Microsoft also announced declines in its Entertainment and Devices division (including Xbox) of 11 percent to $3.77 billion and its Business division (including Microsoft Office) of 10 percent to $5.69 billion from a year earlier.

Microsoft's shares were down 2.1 percent in after-hours trading today to $27.63.

Source: Microsoft

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RE: Windows 8 sucks
By Pirks on 1/25/2013 2:58:33 AM , Rating: -1
the powerful desktops owned by many enthusiasts were just ignored
MS should have ignored enthusiasts much earlier, I'd say. 'Cause maybe they would be able to compete with Apple much better than they do now. Desktop market is a niche these days, not much money to be made there. All the profit is in small devices like phones and tablets. Hence the drastic breakthrough from MS, which is the transition to Win 8. This new OS is very heavily optimized towards mobile computing on tablets instead of being desktop centered like previous versions. MS is just going where the money is, and you can't blame them for that.

iPad is a very serious threat and I think Ballmer is quite smart doing all this huge transition with Win 8 and Metro. Just deal with it, get yourself a nice Clover Trail tablet like Asus Vivo Tab for $500 on newegg, and enjoy the progress. No one will take your desktop from you, this legacy stuff is here to stay and MS won't drop support for it, I'm sure. So don't worry about enthusiasts, they just don't matter now as a target market for MS.

RE: Windows 8 sucks
By cyberguyz on 1/25/2013 6:59:07 AM , Rating: 2
Pirks, you have a very narrow view of the world if you think that only enthusiasts use powerful desktop and notebook systems. Walk into any bank or insurance company. What kinds of hardware systems are the folks in working in these using? Tablets?

You think software developers use tablets to write their code? You think the developers who wrote and maintain Windows 8 are using Tablets for their coding?

You think I am writing this on a Surface?

I can tell you this:

Tablet users are a minority out there not a majority. Many of the tablet users out there also use desktops and/or laptops.

Answer this: When someone is looking to buy a new computer, are they looking to spend their $500 on a 10.1" quad-core tablet with 2GB memory and 32GB storage, or are they going to spend it on a 16" quad core laptop with 8GB memory and 750GB storage? Hell, I know what I would spend my $500 on.

Most cell phone users use Android, not Windows or iOS.

You are calling desktops a niche market. I am calling tablets a niche market due to their horribly limited capabilities. And if you think they are not limited, try playing Skyrim on a "Surface".

RE: Windows 8 sucks
By Pirks on 1/25/2013 2:07:15 PM , Rating: 1
Tablet users are a minority
Yet they drive the majority of computer industry profits these days
When someone is looking to buy a new computer, are they looking to spend their $500 on a 10.1" quad-core tablet with 2GB memory and 32GB storage, or are they going to spend it on a 16" quad core laptop with 8GB memory and 750GB storage?
Get a large heavy device with no battery life to surf the net/facebook/email/netflix/plants vs zombies/etc? Or get a thin light tablet with a couple of days of battery life instead? That's a freakin' tough question, man. I need time thinking about it :)))
Most cell phone users use Android, not Windows or iOS
And most routers use Linux, so what?
I am calling tablets a niche market due to their horribly limited capabilities
Who cares about your opinion? All corporations care about is $$$, and tablets and smartphones mean big $$$ these days, so deal with it.
if you think they are not limited, try playing Skyrim on a "Surface"
I played a few shooters like Dead Trigger, Shadowgun and even medieval themed Inifinity Blade hack'n'slasher, after playing these I don't care about Skyrim or what not. You're seriously pushing an idea that Skyrim on an average/cheapo budget PC (that most people use at homes) looks any better than Infinity Blade on iPad 4? Dude, you gotta crawl outta your cave and say hello to reality! Really.

RE: Windows 8 sucks
By Luticus on 1/25/2013 4:04:38 PM , Rating: 2
You know, I agree with you to a certain point. Tablets are an important and raising force in the computer/technology industry. Personally I run windows 8 on everything from my tablet to my htpc to my twin xeon 32GB desktop.

However, your comparison of a crappy tablet game (and yes, they're all crappy) to Skyrim is a mortal sin! You'll have to pry my skyrim from my cold dead hands! That said, even though skyrim is 5000% better on the PC, it can be had on the PS3 and/or XBox to those who don't care about free community mods and such. Skyrim is but one of many though. Battlefield 3, Call of duty, Crysis, etc all cream any "tablet/phone" game out there. I understand that I'm the exception, not the rule and that most people with a desktop probably use it for mp3s, facebook, school work, and minesweeper and could likely make due with a tablet easy. I have a tablet too, and it rules. It's a supplement to my desktop though, not a replacement. When I need the power, I have it. Personally I need the power often as I do things with my PC's most people wouldn't touch.

RE: Windows 8 sucks
By Luticus on 1/25/2013 4:09:00 PM , Rating: 2
Oh, and I agree GIVE ME BACK MY AERO!!!!

Custom gestures wouldn't be bad either.

RE: Windows 8 sucks
By Pirks on 1/25/2013 4:42:34 PM , Rating: 2
Yeah, I know that you and other high end PC gamers with $1000+ 133t rigs look down on tablet gaming but you have to understand that you guys are a minor niche these days. Big money is in tablets and tablet gaming and it will grow quite a lot unlike the PC gaming which won't grow as fast or won't grow at all. Problem is you don't understand that Apple invests a huge amount of R&D into the fastest (and at the same time cheap and efficient) tablet SoCs possible, their newest A6X chip is quite good at 3D and way, way better than tablet SoCs from just two years ago. With such amount of progress don't be surprised seeing tablet gaming going up significantly in profits and quantity/quality of content while PC side staying the same.

It's just that Apple and MS are looking at the future and you are looking at the past. It's that simple :)

RE: Windows 8 sucks
By Luticus on 1/26/2013 5:03:37 AM , Rating: 2
It's not so much that I look down on tablet gaming, it's that most tablet games genuinely suck. Very few are worth my time of day. Ninety percent of them are word games, cut the rope, angry birds in some other scenario everyone wows over... these games are neat/fun for about five minutes and then quickly uninstalled. They are certainly NOT a replacement for my computer/console games. When I pick up my phone it's pretty much never to play games. Actually the only reason I have any games on it at all is so I have something to do while I'm sitting on the can at work. Yes tablet games will get better, this is obvious and I have absolutely no doubt that they will some day be what PC gaming is today. Thing is, your assertion that PCs are just going to stand still is dead wrong. Progress will be made. Hell, have a look at the newest cryengine stuff and tell me anything on your tablet comes close to it. Yes, SOC'S are great, but their focus is mainly on power efficiency and not on maximum performance. That's what makes them ideal for tablets and cellphones. PC's on the other hand could care less about power consumption for the most part, and therefor they can focus purely on performance. In fact it's only been in recent years that laptops became as "good" as desktops performance wise and that's still a stretch. You can by a laptop with an i7 and 16GB RAM sure, but it'll last you about 3 hours tops, cost a ton of money and is only about half to three quarters as powerful as a desktop at equal price (certainly can't touch my main system). There is no arm processor that can come close to touching anything even one of xeons can do, and there wont be for quite a few years because that's not their focus. By the time there is, my new xeons will be far superior. So really it's a question of how much processing power do we really need. As applications get smarter and AI becomes more standard and we demand complex tasks be faster and faster, well as always, the sky's the limit. There will always be (at least for the foreseeable future) a place for desktop and traditional laptops. They might not be as big a market as the tablets are but they aren't fading away into obscurity as some people would have you believe. Even Apple realizes it and that's why they still sell them.

RE: Windows 8 sucks
By nikon133 on 1/28/2013 6:33:47 PM , Rating: 1
In addition - most enthusiasts I know, hardcore PC gamers, really don't care about makup. For them, it is all about improving performance in games and apps, and overall system performance - boot/shutdown/restart times etc. Which, I think, W8 delivers nicely.

"You can bet that Sony built a long-term business plan about being successful in Japan and that business plan is crumbling." -- Peter Moore, 24 hours before his Microsoft resignation

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