Microsoft Results Top Expectations Despite Sales Dip

(RTTNews) - Software giant Microsoft Corp. (MSFT) announced a profit for its fiscal first quarter that came in well above Wall Street's expectations. The better-than-expected performance came despite a significant drag from the negative impact of currency exchange rates.

Revenue dipped from last year, hurt by a drop in its personal computing category. The company saw a particularly sharp decline in phone-related revenue, though it said this was largely the result of implementing a new strategy for the segment.

Even with the top-line slide, the company's adjusted revenue figure came in slightly above analysts' predictions.

The maker of the Windows operating system said first-quarter net income came in at $4.62 billion, or $0.57 per share. This was up slightly from $4.54 billion, or $0.54 per share in the same period last year.

The quarterly results for both this year and last year included integration and restructuring charges. Leaving out these items, the company's adjusted profit actually dipped from last year, largely as the result of currency exchange.

Microsoft revealed an adjusted profit of $5.38 billion, or $0.67 per share. This compared to $5.45 billion, or $0.65 per share, in the same period last year. Operating profit came in at 7.07 billion.

The company's adjusted EPS rose from last year, despite the slide in earnings, due to fewer shares outstanding.

Microsoft said that its adjusted earnings would have been up 11 percent compared with last year, if the impact of foreign currency exchange was stripped out.

The $0.67 per share figure for the first quarter came in above the $0.59 per share that market analysts expected the company to earn, according to a survey conducted by Thomson Reuters.

Microsoft's revenue dipped to $20.4 billion compared to $23.2 billion last year. Adjusted for the impact of revenue deferrals related to Windows 10, the company's revenue figure for this year was $21.66 billion.

Wall Street was looking for the firm to post a top-line figure of $21.03 billion.