Microsoft writes off $6.2B for failed Aquantive acquisition

Microsoft is taking a hefty goodwill writedown for its 2007 purchase of Aquantive. The acquisition didn't deliver the ROI the software giant hoped for -- to put it mildly.


Microsoft said that it will take a fiscal fourth quarter charge of $6.2 billion to mostly write down its 2007 purchase of Aquantive.

Aquantive was one of that acquisitions designed to bolster Microsoft's ad business. Microsoft said it will take the charge as part of its goodwill impairment test. Goodwill charges arise when a company's fundamental business is lower than the value paid.

Indeed, Microsoft paid $6.3 billion in cash for Aquantive in 2007. The company said in a statement:

While the Aquantive acquisition continues to provide tools for Microsoft's online advertising efforts, the acquisition did not accelerate growth to the degree anticipated, contributing to the write down.

Microsoft said in its statement that the online services division is on the right track and Bing is increasing revenue per search. The end of Microsoft's fiscal year will provide another opportunity to tally the company's online losses over the last decade.

So far, Microsoft's online unit has lost $8.5 billion over the last 9 years.

This item first appeared on ZDNet's Between the Lines blog under the headline "Microsoft takes $6.2 billion goodwill charge for online unit."

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