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Microsoft Earnings Surge To Record $575 Million Sales Of Windows 95 Contribute To 54 Percent Gain

Associated Press

Microsoft Corp.’s second-quarter profits were up 54 percent over the same period a year ago, to a record $575 million, the company said Thursday.

Revenues for the period ended Dec. 31 were $2.2 billion, up 48 percent from $1.5 billion the previous year.

“This has been another strong quarter for our company,” said Bob Herbold, chief operating officer for the personal computer software giant. “These record results reflect the continuing adoption of the full range of our products by customers worldwide.”

Net income for the quarter was 90 cents a share, compared with $374 million or 60 cents a share a year earlier. The 90 cents includes a one-time net gain of 3 cents per share from the sale of long-term assets.

Paul Maritz, group vice president for platforms, said “momentum continues to build” for both the Windows 95 and Windows NT operating systems.

The company did not immediately say how many copies it had sold of Windows 95.

But it said revenues from licenses to original equipment manufacturers, who preload Microsoft products on new computers, rose from $548 million in the first quarter to a record $672 million in the second quarter, up 75 percent from a year earlier.

Windows 95 retail upgrade revenues were $180 million in the second quarter, down from $260 million in the previous three months, a drop-off expected after the initial sales rush.

Analysts had lowered their estimates of 1995 sales of Windows 95, based on the overall poor Christmas selling season and the reluctance of consumers to pay to improve their computers to handle Windows 95.

Nevertheless, Windows 95 still is shipped on nine of 10 personal computers sold. Dataquest Inc., a San Jose, Calif., technology research firm, estimated Microsoft would sell 16 million copies by the end of the year, down from its initial estimate of 20 million.

For the first six months of the fiscal year, net income was $1.1 billion or $1.68 a share, compared with $689 million or $1.10 a share a year earlier.