Earnings: Microsoft Cutting Up To 5,000 Jobs; Q4 Net Income Down 11 Percent
This story was written by David Kaplan.
Ahead of this afternoon's earnings report, Microsoft (NSDQ: MSFT) CEO Steve Ballmer says that the company will eliminate up to 5,000 positions, the company said in a 10-Q filing. We noted yesterday that McAdams Wright Ragen analyst Sid Parakh predicted the Redmond company would announce cuts of 6,000 to 8,000 employees, or 6 percent to 8 percent of its 95,000 workforce. The cuts had been expected, on weaker profits and poor sales of Windows as the PC market shrank amid the global recession.
About 1,400 jobs will be cut immediately. Further reductions will be made by June 2010. Microsoft expects to save roughly $1.5 billion in operating expenses and $700 million in 2009 capital expenditures.
Earnings: Net income came in $4.17 billion, down 11 percent year-over-year, with EPS of $0.47, missing analysts' estimates of 49 cents, according to a consensus compiled by Briefing.com, which was cited by CNN Money.
Revenues: Despite the deteriorating economy mentioned in its report, Microsoft's revenues were something of a bright spot. Revs came in $16.63 billion in Q4, a 2 percent gain over last year's $16.37.
By David Kaplan