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| Microsoft profit beats estimates |
| Bloomberg / Seattle Oct 24, 2009, 00:39 IST |
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Microsoft Corp, the world’s largest software maker, posted a smaller drop in profit than analysts estimated after slashing costs to make up for falling sales. The stock had its biggest jump in six months on the Nasdaq.
First-quarter net income fell to $3.57 billion, or 40 cents a share, beating the 32-cent average estimate of analysts surveyed by Bloomberg. Revenue, excluding $1.47 billion deferred to a future quarter, was $12.9 billion, Microsoft said in a statement. The company boosted its cost-reduction target.
Operating costs fell 6.9 per cent after Microsoft made its first companywide firings, slashed travel costs and cut the rates it pays vendors to cope with slower spending by business customers. Demand from consumers helped sales of Windows for personal computers and the Xbox to exceed the estimates of Goldman Sachs Group Inc analyst Sarah Friar.
“The numbers are great,” said Jeff Donlon, an analyst at Manning & Napier Advisors Inc, which manages more than $20 billion, including Microsoft shares, in Rochester, New York. Microsoft rose $2.07, or 7.8 per cent, to $28.66 on the Nasdaq Stock Market at 10:13 am New York time, after climbing as much as 10 per cent, the biggest intraday jump since April 24.
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