Want CNET to notify you of price drops and the latest stories?

Microsoft Q2: By the numbers

Here are highlights from the first quarterly earnings report from Microsoft since the debut of Windows 8 and Surface.

Charles Cooper Former Executive Editor / News
Charles Cooper was an executive editor at CNET News. He has covered technology and business for more than 25 years, working at CBSNews.com, the Associated Press, Computer & Software News, Computer Shopper, PC Week, and ZDNet.
Charles Cooper
2 min read
Microsoft CEO Steve Ballmer Getty Images
Microsoft has issued its first earnings scorecard since the introduction of the Windows 8 operating system and of Surface, its first branded tablet computer. The company's fiscal second-quarter report also opens the latest window -- no pun intended -- onto the pace of decline of PC shipments as more people switch over to smartphones and tablets.

Here are some of the highlights by the numbers:

  • Revenue: $21.5 billion
  • Net income: $6.38 billion
  • Windows: $5.88 billion, up 24 percent year-over year. (That number includes revenue deferrals tied to an earlier upgrade offer as well as presales. On a non-GAAP basis, the revenue increase was 11 percent during the quarter.)
  • Windows 7: More than 60 percent of enterprise desktops are using Windows 7.
  • Windows 8: Not a lot new to report. Microsoft said it sold more than 60 million Windows 8 licenses. But that tidbit was first released earlier this month. CFO Peter Klein echoed the canned quote that accompanied the earnings press release describing Windows 8 as "a big, bold re-imagining of Windows across the whole ecosystem." He said Microsoft had "all collectively learned a lot from the user interface to touch devices. There's a lot of things we're working on with our partners that continue to drive this process forward. This is a big, ambitious re-imagining of Windows and this quarter was the first step." Whatever that means.
  • Surface: Was described by Klein as a "contributing factor" in the growth of the Windows business in the quarter. "It obviously had some limited distribution this quarter, and we're excited about expanding that."
  • Entertainment and devices: $3.7 billion in sales, down 11 percent from the prior year period. On a non-GAAP basis, the decrease was 2 percent. Some $380 million got deferred and Microsoft said it expects that sum to be released in its next quarter.
  • Xbox 360: 5.9 million consoles sold, down 28 percent year-over-year.
  • Skype: Logged 138 billion minutes, up 38 percent.
  • Online ad revenue: Up 15 percent.
  • Server & Tools business: $5.19 billion, up 9 percent.
  • Microsoft business: $5.69 billion of revenue, down 10 percent. After taking accounting adjustments into consideration, the division posted a non-GAAP revenue increase of 3 percent.