Microsoft posts first-ever loss, revenues still up | Business| Economy and finance news from a German perspective | DW | 20.07.2012
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Microsoft posts first-ever loss, revenues still up

Microsoft has posted its first-ever quarterly loss, but revenues were still up five percent from last year, beating Wall Street’s expectations. The loss came from its 2007 purchase of digitial ad firm aQuantive.

Microsoft logos hang over their booth on the opening day of the International Consumer Electronics Show (CES) in Las Vegas in this file photo taken January 10, 2012. Microsoft's keen new interns already think their competitors' days are numbered, branding Google and Facebook as creepy because of their aggressive stance on privacy and heavy reliance on advertising. REUTERS/Rick Wilking/Files (UNITED STATES - Tags: BUSINESS SCIENCE TECHNOLOGY)

Microsoft Messe Las Vegas

Microsoft announced its first quarterly loss as a public company in 26 years late Thursday. The software giant took a write-down of about $6.2 billion (5.06 billion euros) for the April-June quarter after determining that the 2007 purchase of aQuantive had had not helped it overtake competitor Google Inc.

The company's chief financial officer, Peter Klein, said Microsoft still had "solid revenue growth" and described the write-down as "rigorous cost discipline."

Despite the loss of $492 million in its fourth quarter, Microsoft's fourth quarter revenue rose four percent to $18.06 billion, with an annual revenue that rose five percent to $73.7 billion.

The quarterly loss compared with profits of $5.9 billion in the same quarter in 2011, but was almost entirely attributable to the write-down. Experts said that discounting one-time costs, the quarterly performance would equate to a profit of 73 cents per share - exceeding Wall Street projections.

Following Thursday's announcement, Microsoft's shares jumped by more than two percent.

Microsoft acquired digital advertising firm, aQuantive, in 2007 in the hopes of becoming more competetive with Google Inc. The partnership has cost Microsoft over $9 billion over the past five years, not including the purchasing cost of $6.3 billion.

High hopes for Windows 8

Despite the loss and inability to profit from online services, Microsoft dominates the software market and hopes its Windows relaunch will maintain its stability.

It "is simply the biggest deal for this company in at least 17 years," Ballmer told AP last week. "It's the glue; it's the foundation of everything Microsoft is built on."

The much-anticipated Windows 8 is due to be released on October 26. Microsoft is also due to launch its first tablet, the Surface, on the same day.

kms/msh (AFP, AP)