Microsoft FY12Q3 Results
Isn't this the best time ever to be in tech! I love it. And I love profits, too!
I know, I just lost half of you there.
But it's amazing. The amount of competition and change and adoption makes me nothing but giddy. If you're a PlayStation fan-boy then you have to at least love the competition Xbox brings to make PS better. And same for Xbox. Same for Apple, Google, and Microsoft. The competition between iOS, Android, and Windows is awesome, especially if you're a developer or service being wooed day-in and day-out.
Inside Microsoft, we'll constantly flagellate ourselves about how other competitors are leapfrogging us. But it's good to see, starting way back when I said Microsoft Has Turned The Corner, the amount of collaborative integration that has happened to make the whole far greater than the sum of the parts. A snippet from that post from near three years ago:
Redemption takes a while. Time is needed to allow perception to change and to re-earn trust and respect.
Windows 7 re-earned trust and respect. Windows 8 is a big turning point. It's not perfect. It's no true iPad compete story: it's different. However, it would not have existed without the iPad. Thank you, Apple. RIP Steve. It's a big reboot of the Windows developer story in a way that is fresh and semi-consistent, visually, across phone and Xbox (and slowly across our web properties, too).
Our developer story is still concerning. Windows 8 is blazing it's own trail, which is different than WP and different than Xbox. For now. It's not that I want to write the same app between all the platforms, but I do want no-friction traversal for a Dev to start on one, have a great idea, and switch over and start on the other, without muttering, "WTF, this is completely different." We have a chance to get there and that vision needs to be revealed soon.
Consistency is one thing, quality is another. I was reading that HBR article about Steve Jobs leadership lessons and the first thing I thought about it: Steve Jobs would not have let almost any of those new Xbox apps ship. He would have torn them to pieces. I think this is a case where we so desperately wanted out partners to support the new Metro that we gave in to mediocrity. And once it's there, it's there for good. This is where we really need to clamp down or what is prime real-estate is going to turn into a flea market.
So anyway, how are we doing? I'd say we're on the upswing with endless challenges. We turned the corner and did indeed manage to get out of the bad side of town. Profits are up, people are writing appreciative come-back articles, and I really don't have much of an ax to grind (well, except for the premier software company being completely incapable of creating an enlightened review model, let alone lately keep some key young talent). Go-go-Microsoft!
Some links on today's earnings:
- Microsoft beats estimates as most divisions see growth - GeekWire
- Microsoft’s Earnings Surpass Expectations - NYTimes.com
- Microsoft Q3 2012 by the numbers $17B revenue, 60 cents EPS
- Microsoft turns in a strong quarter Microsoft - CNET News
- Update Microsoft exceeds analysts' estimates with $17.41 billion 3Q revenue Microsoft Pri0 The Seattle Times
See you next quarter!
64 comments:
You did not lose me at the first line, but when you talked aboit te comeback stories in the news.
Au contraire, I find a staggering amount of negativity towards Microsoft. Some of it deserved, most of it not.
The opinion makers did indeed spot a comeback, I agree, but they are not going to just sit and let it happen. They are going for the jugular.
Sorry, but results are not impressive. Bing still burns money (500 million/quarter), Entertainment is burned by weak/nonexisting WP sales, Servers reached level of Windows sales. Microsoft is officially an enterprise software company now. Windows 8 is unlikely to cause an impact, the rest of enterprises will upgrade their XPs to Windows 7.
Former Softie.
It's scary that we bought Skype for 12 billion yet we only make 4 billion profit in a quarter. Still a stunning number but c'mon!
Also Bing has over 200 PMs. That is even scarier.
Lastly Window Phone has a long way to go. It's funny that people in the MSFT bubble actually think the Lumia 900 is "leaps and bounds" better than the competition. Please stop patting yourself on the back and work on the real leapfrog product.
Well, good job that you're beginning to steer that oil-tanker of a ship around, but I think you'll ultimately fail, you're just too big.
Look at Windows 8, there's been some good reviews of the Metro interface for tablets, but when people refer to it as a desktop replacement, the reviews are all pretty much "WTF?". I agree consistency is good, but that should really apply to the underlying development code, not the entire UI for totally different platforms.
Still, good luck with that, I still think the dev division and windows division will struggle to work together properly.
As for profits: I see XBox sales plummeted, online is still leaking cash, and no-one wants to buy Phone. That's probably a problem for Windows 8, if no-one wants a Windows phone, why would they want an upscaled version of Windows that doesn't really work very well in the old monopoly position of the enterprise? I think Win8 will be another Vista, so roll on Windows 9!
We'd also like to see Windows Phone sales figures, c'mon. Not releasing them just makes us all think they're truly dreadful. which they probably are.
Thanks for the post, mini.
The products are promising, sure, but I'm a bit worn down watching colleagues be managed out. The hell they put people through so they 'choose' to quit rather than get fired... it's pretty disturbing to see what only can be described as emotional abuse and sadism. There are high rates of nervous breakdowns from people at Microsoft, and it's not because of things the employees did...
I am mourning how many good and talented 'young' people (people without families) have just left. It makes me wonder whether the future is innovation or maintaining the existing profits. The workforce that will remain is well-positioned for the latter, but I think many hope for the company to do the former.
Bummer that this site lost its way... there is no way that this post was written by the original Mini, different feel, tone and voice... just another piece of evidence that MSFT is a shell of it's former self... can't even have a dialog among employees, alumni and community any longer.
Bing's newest feature: Social Search! Automatically post your queries to your facebook wall.
Why? When Yahoo added the "Share" button to news stories 3 years ago traffic went up 40%. The same will happen with search, right? And why ask users to share queries, why not opt them in? That's the power of data-driven decisions Microsoft managers are so good at.
It will be a killer feature!
"(well, except for the premier software company being completely incapable of creating an enlightened review model, let alone lately keep some key young talent)."
Be much more concerned about the key old talent who are just waiting for the right opportunity so they can leave the young 'uns in the dust. Headhunter calls are way up, and offers are starting to be tempting for the experienced professionals. Good luck minding the kids.
And if the original Mini could return, we would all be grateful. Less cheerleading and blindness, more straight talk.
The products are promising, sure, but I'm a bit worn down watching colleagues be managed out. The hell they put people through so they 'choose' to quit rather than get fired... it's pretty disturbing to see what only can be described as emotional abuse and sadism. There are high rates of nervous breakdowns from people at Microsoft, and it's not because of things the employees did.
This could not be truer. I have had three teammates AGED OUT since last year's review. One quit, but the other two were at least wise enough to be walked so as not to jeopardize their unemployment insurance. One was over 40 and the other two over 50; I saw nothing to indicate that there was a performance problem -- one had an organization-wide award in June.
I've now hit 40 and have had a few, as yet unsuccessful, interviews; but will keep looking until I find the right position. It feels like more positions are available than a year ago. I'd rather get out on my own terms instead of waiting around for "my turn."
Is someone new writing this blog? This entire post sounds different from the Mini of old.
You're right this sounds more like a press release than mini
Nobody seems to have noticed that MS lowered its expense guidance as part of the earnings call? You know what that means, don't you.
It's scary that we bought Skype for 12 billion yet we only make 4 billion profit in a quarter. Still a stunning number but c'mon!
Huh? While I am not naive enough to think the purchase directly led to the increase, every company in the world would BEG to spend 12 billion to EARN 4 billion in a single quarter.
Maybe you need to read up on basic business terminology to understand the difference in operating expenses, acquisition costs and profit.
>> Bing's newest feature: Social Search! Automatically post your queries to your facebook wall.
Not sure it's a good idea. Bunch of my queries are quite private, I wouldn't want my Facebook contacts to see them. Another stupid Google-compete effort from Bing.
"Nobody seems to have noticed that MS lowered its expense guidance as part of the earnings call? You know what that means, don't you."
Do you mean that layoffs are coming?
I'm not so sure I agree it's not the same Mini writing here. What I sense is the heart isn't into it as much, so it's more rushed and the analysis isn't as in depth as what Mini is capable of. Though I guess only Mini really knows...
"Do you mean that layoffs are coming?"
Layoffs. Stealth layoffs. No raises. Low raises. No matter what form it takes it won't be good for Ms employees as a whole.
I am surprised that there is almost no chatter over E&D, which saw a 16% drop in revenue. The XBOX 360 is clearly at the end of its lifecycle. It would be the perfect time to evaluate whether or not Microsoft managed to make money off that device. The XBOX program as a whole is deeply in the red over its 10+ years of existence. My educated guess is that the 360 is probably a money loser as well. It should have been replaced a year ago but Microsoft kept it alive (just like Sony did the PS3) to eke out just a little more profit in order to make up for the previous losses. I know XBOX fanboys will defend their division but E&D in its best quarter contributed something like $350 million in profit to the company’s bottom line (and that’s not just XBOX, that’s all of E&D). The RRoD debacle alone had a one b-b-b-billion price tag (equivalent to 3 to 4 good quarters worth of profit). Now the vicious cycle starts anew. Microsoft will have to take losses once again in order to manufacture and market a new device. Eventually those losses will subside but profits will never be enough to offset the cost of launch. The sad thing is, XBox is probably the _only_ product keeping Microsoft relevant to the younger crowd, yet financially speaking it’s a no-op at best.
Good to see and experience the 4% pop, it's about time!
W8 goes RTM soon, another re-org coming in WWL. StevenSi should publish the poll result so that we know which GPM or Lead to "avoid" or get away from. The bashing together of COSD and WL after W7 shipped was a disaster, all those bad leads and GPMs in WWL should be shown the door before they can do their damages again on W9. Who are the bad ones? Just look at poll result and who has had HR and subordinate issues, for crying out loud, it's not that hard.
Will take a 4% anyday.
Frankly I'm shocked by the tone of the comments. Listening only to these comments, one would think Microsoft is on it's last legs ready to file Chapter 7. I can't imagine why there is such a relentless cheerleading for the demise of such an important company in the world. Really did Steve Ballmer piss in your corn flakes?
at the end of the day good progress. Stock up 20% rich product pipe...lets celebrate the successes.
That being said we need to remove the internal roadblocks ...
Richard Clayton, Windows HDX GPM pissed in hiw own corn flakes.
MSIT India.. How are things after the constant reorgs?
This isn't the same mini experience as before. Many fewer posts. Many fewer comments. And the tone was either someone going through the motions or someone else.
Well, let's hope it's all better after win8, o15, and wp8!
MSIT India.. How are things after the constant reorgs?
No one cares about MSIT India. Please start MiniMSIT India.
Frankly I'm shocked by the tone of the comments. Listening only to these comments, one would think Microsoft is on it's last legs ready to file Chapter 7. I can't imagine why there is such a relentless cheerleading for the demise of such an important company in the world. Really did Steve Ballmer piss in your corn flakes?
I think blog is the only way people can respond to the relentless internal cheerleading at whatever product we put out. Whether it be crap or not. Everything is now "social" on MSW so you can't give you're real opinion unless you want to be blackballed.
I would love to see a Mini post on Windows 8. Right now I fear that it will be a failure. Every sector in the company is pushing it's weight onto Win8 hoping that it will be a success....
I’m a former microsoftee and what I’ve heard about Windows 8 isn’t very positive. I ended up giving the preview a spin to form my own opinion and unless drastic changes occur before the release, this isn’t going to be my next desktop OS. On a computer without any touch capabilities, this thing sucks. Metro with a mouse and keyboard feels like you’re trapped on one of those educational toys for pre-schoolers. Of course you can switch to the desktop (which makes it feel like all the sudden you’re running an entirely different piece of software) but they’ve even managed to ruin that experience with the removal of the start button.
It might be better on tablets, but regardless of the quality of the experience I fear Microsoft is too far behind to make a serious dent in Apple or Google’s business.
The NY Times has a damning article on foreign corruption in Mexico at WalMart during the time period that Kevin Turner was running Sam's Club. Here's hoping Mr. Turner was not involved in that unethical behavior.
http://www.nytimes.com/2012/04/22/business/at-wal-mart-in-mexico-a-bribe-inquiry-silenced.html?_r=1&hp
i left msft recently. I'm one of the 'young' employees fleeting away. I joined this company in my early 20s and left in late 20s.
I'm tired of the toxic culture, low compensation, endless reorgs and expensive/unhealthy cafe.
- Toxic culture. 1) We are releasing features not solving a real problem but just make it look pretty to satisfy GM. I spend months on a data visualization project to make the pie chart looks fancy. I believe leadership will look at it no mroe than twice a week. 2) Reinventing wheels. How many string libs do we have in MSFT? More than one thousands I bet.
- Low compensation. I got most of my reviews at E/20. But sadly I found a new grad in my team has a higher salary than I do. Yes, it's good to work for tech right now, fresh grad out of college makes 100k base salary. WTF? I ramped this dude and he is fresh out of college. Alrite. One round phone screen plus one day onsite can get me a position with 40% bump in my W2. Why not?
- Endless reorgs. You know, Politics.
- Expensive/unhealthy cafe. Which cafe do you like the best? For me, none of them. They are food. But not good food. Those garbage cost me a fortune.
I have many friends at my age who work in Redmond. I know most of them, eighty percent at least, are thinking to leave. But due to the non-challenging day job, their technical skills are rusty. They can't move. They got stuck here. It's sad, but so true.
Speaking of Windows 8? Good luck.
I am curious what company did you join? i want to know because i am also looking to leave, thanks.
i am curious, what company did you join? i might want to interivew there
I'm not the person who posted at 5:14:00 PM but if you're looking to leave Microsoft, your options in the Seattle area are plenty.
The obvious choices are Google and Amazon. Facebook also opened a Seattle office recently and has positions available. Adobe has been there for a long time. Microsoft spin-off Expedia is located in downtown Bellevue.
There are also a surprising number of game companies in the Puget Sound region as well as numerous startups.
Chances are the OP went one of those routes. The problem with leaving Microsoft isn't really finding a place to go. If you have actual skills and don't mistake visibility for tangible results, you'll find a company that matches your goals.
Did Skype make any profit before it was acquired for $8 billions?
I left about 2 years ago. I'm glad to report, it's a lot happier on the outside, and I've almost doubled my salary since then :)
+1. Left one year ago. More money. Happier. Shipped two releases already. Feel really sorry for the colleagues pinging me on fb and linkedin for references out.
I am currently a .NET Developer looking to leave this place and go to another company, mostly because I am pretty much bored with the culture (I don't think its good or bad) but i just want to try something different. I've been a .NET dev every since i started my career and I would like to keep doing .NET. can anyone here in the comments recommend cool companies that use .NET developers?
Good article about sick culture at MS: http://techcrunch.com/2012/04/22/frustration-disappointment-and-apathy-my-years-at-microsoft/
Wow, it's patently obvious now that the original Mini is no longer writing this blog... not only is the content garbage that sounds like it was written by our corporate PR department, but the number of comments is about 1/100th what it would have been had the real Mini been writing.
This is now officially off my favorites list, as I'm sure is the case with most other people.
Best of luck in your future endeavors, minimsft. Yech.
If you want a cool company, and want to try something different then stop with .NET dev, get out and learn Linux - FB, Google, all these good cool companies are not .NET shops, they're more open and fun. So get past legacy .NET and actually learn something different.
"See you next quarter!"
Don't bother, you're not writing anything insightful or worth reading.
One post per quarter, and this is the best you can do?
Mini, time to shut down this blog.. looks like you're now inducted by the emperor!
It's interesting that the current Mini (be it the original or a stand-in) is now making just a few drive-by posts a year and not even attempting to participate in a conversation.
This is SO Microsoft. If nothing else it reveals Mini to be blind in the way that many long-term Microsoft employees are blind.
If Mini wasn't blind, he or she would reflect on this question:
Exactly what is this blog of mine contributing to a conversation about making Microsoft better? And what does it mean to make Microsoft better? Is what I'm writing contributing anything to product development improvements?
This blog is basically a link aggregator of influential analyst discussions and a few snippets of the same kind of commentary you can read anywhere online.
Hubris and ego is the only thing keeping this blog going. Mini isn't writing anything interesting, s/he's not participating in the conversation and s/he's even stopped pretending that the blog has any point.
Sounds a lot like the Microsoft corporate culture that I see every day.
Mini, wake up, pull your head out of your Microsoft partner ass, and just take this stupid blog offline already. It's YEARS past its expiration date and nobody cares any more.
Odd, if some people don't like the blog, they don't have to return. What does it matterif Mini continues or not?
Peter Weyland for next CEO
https://www.weylandindustries.com/tedtalk
Poll results came back yesterday... let's get this discussion rolling!
"Odd, if some people don't like the blog, they don't have to return. What does it matterif Mini continues or not?"
Because this blog retains a certain amount of traffic and mindshare within the community of people who follow Microsoft even though it's become a waste of space. Removing it from the blogosphere at this point would be a service to Microsoft, which is ostensibly what Mini cares about.
"Removing it from the blogosphere at this point would be a service to Microsoft, which is ostensibly what Mini cares about."
What part of all of this being his choice, not yours, did you miss? He has no obligation to you or anyone else.
"It's YEARS past its expiration date and nobody cares any more."
Apparently you care, as do the other ten morons who wrote similarly inane comments.
"It's scary that we bought Skype for 12 billion yet we only make 4 billion profit in a quarter. Still a stunning number but c'mon!"
12? Are you quoting some all in cost? Because the initial price was $8.5. As an employee, one would expect you to know that.
"AndyB said..."
God, are you still trolling? Wasn't your time on WinRumors using half a dozen different aliases enough?
"Nobody seems to have noticed that MS lowered its expense guidance as part of the earnings call? You know what that means, don't you."
Right, it was only reported in several hundred articles. No, I don't know what it means, besides the obvious. It could mean anything from headcount reductions to less capex. Nor do you know, despite pretending you do.
"I was reading that HBR article about Steve Jobs leadership lessons and the first thing I thought about it: Steve Jobs would not have let almost any of those new Xbox apps ship. He would have torn them to pieces."
Perceptive comment and a real issue for MS. Ballmer just doesn't sweat the details. And he also doesn't come down hard on those that ignore them and routinely make boneheaded and highly visible mistakes. This has cumulatively resulted in a lot of damage to MS's reputation, and portrays a company that is erratic and unfocused. Where Apple appears to be one company headed in one direction, even though it's now much larger than MS, Microsoft still looks like a collection of independent groups that are as busy fighting each other as they are external competitors. When Ballmer is finally gone, which hopefully isn't much longer, ideally the replacement will be a lot more hands on and err, at least initially, on bringing order to the current unruly mob.
"... it's become a waste of space."
You don't trust others to be able to make that judgement for themselves?
"What part of all of this being his choice, not yours, did you miss? He has no obligation to you or anyone else."
Why do you care so much about my opinion on the matter? And better yet, why do you feel the need to stand-in and represent for minimsft himself?
Ballmer doesn't have the ability to conduct a thorough technical review. That's why we used to have a Chief Software Architect.
"Ballmer doesn't have the ability to conduct a thorough technical review. That's why we used to have a Chief Software Architect."
You mean like Ozzie? Yeah, that worked well. ;-)
Or Billg. That was his job title after he stepped down as CEO
"Or Billg. That was his job title after he stepped down as CEO"
Which corresponds pretty well to when the company went into the shitter.
CSA at Microsoft doesn't work, you need a CEO who isn't just a car salesman.
You mean like Ozzie? Yeah, that worked well. ;-)
That's funny right there. All of these "Mini has been replaced/hacked/lobotomized" rumors... Ever stop to think Mini is fighting an internal struggle with trying to be positive or writing something productive versus being a devil's advocate and allowing the comments on his posts to be a troll and FUD breeding ground? Reading this thing is depressing sometimes. In my years with the company, I've found my personal trolling to be proportionate with my management's transparency. Although, regardless of how transparent things can be, it still doesn't hurt to check to see if Mini or Mini-Mini or Bizarro Mini or Kool-Aid Mini shows up every quarter.
"And better yet, why do you feel the need to stand-in and represent for minimsft himself?"
Mostly because I don't like rude, disrespectful a-holes who come to someone else's blog and then criticize its content or the way they run it.
"Mostly because I don't like rude, disrespectful a-holes who come to someone else's blog and then criticize its content or the way they run it."
And so your response is to behave like a rude, disrespectful and *entitled* a-hole who thinks his shit don't stink, as they say in the business.
Bravo, chief. Well played!
This blog is indicative of the state of the whole company.
Meanwhile, Apple's profit is now over DOUBLE that of Microsoft's ($11.6B just reported vs. $5.11B of MSFT).
All from new products introduced in less than 5 years (XBox comparison anyone?).
Comparisons with Apple are unrealistic. They have among the most loyal customer bases one could imagine, their margins are sky-high, and their perception in society today is stellar.
Apple could release nearly anything these days and it would sell in shocking, stunning volumes.
My wife, who knows zip about technology announced recently that she wanted an iPad. When I asked why, she couldn't give me any solid answers except that it was obviously the best thing to have. I don't think my experience was unique in the slightest.
Were Microsoft to approach any of these achievements, we'd truly be on the upswing:
- Amazing margins.
- Customer base that doubles as zealots.
- Godlike perception from the public-at-large.
I'd be thrilled with only one. :)
"Were Microsoft to approach any of these achievements, we'd truly be on the upswing"
It sure would help if Steve didn't sound like a petulant 12 year old whenever he opens his stupid mouth.
And if our advertising wasn't the worst in the business.
And if our phone team made something that wasn't an obvious also-ran.
And if we stopped collectively believing that Metro -- AN INTERFACE CONVENTION, FOR CHRISTSAKES -- was the most amazing thing that technology has seen in 20 years. It's not, it's an interface convention. For fucksake.
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