Vista Sales Strong, Higher Than Expected

An anonymous reader writes "Despite reports, it seems Microsoft is not only alive, but has been thriving these last few months. Following Apple's solid earnings yesterday comes above-expectation reporting from Microsoft. Profits jumped 65% from the previous year, and sales of its Windows operating system were strong: 'Microsoft said it deferred $1.2 billion in Windows Vista revenue to the third quarter, to account for upgrade coupons given to PC buyers during the holiday season before the consumer launch of the new operating system. Excluding this figure, client revenue totaled $4.1 billion, 30 percent higher than last year.' Microsoft Chief Financial Officer Chris Liddell said Vista beat internal forecasts by $300 million to $400 million, and Office 2007 sales were $200 million better than expected."

Only 30%?

[EchoD]

Revenue is only 30% higher after releasing a new product, and this is higher than expected? I'm no expert, but for a new "revolutionary" product that the whole Windows world is expected to adopt... not so good.

Re:No!

[bigman2003]

Not only is Microsoft dying..

But every other OS that manages to bump up its marketshare more than 3% is the wave of the future, and the only bandwagon you should be on!

A lot of people seem to think it is harmful to your career to ally oneself with the technology that is still the overwhelming leader in the market. Personally I don't understand that.

It's kind of like being the the transportation industry, and choosing to specialize in bicycles...economically, it is not a very good plan.

Well, duh.

[KlausBreuer]

Obviously they sold a lot of Vista.
After all, every new PC comes with Vista, if you want it or not (with very few exceptions).
Thus, sales are up. Since Vista is not all that cheap, profits are up.

You're surprised?

Coupons == Stock manipulation?

[morgan_greywolf]

This just reeks of stock manipulation. Hold back your sales figures for an extra quarter, cash in those stock options, and then suddenly announce, 'oh yeah, we had these coupons, so we had to hold back our sales figures.' Then watch your stock price shoot through the roof.

But, I just looked at their insider trading roster and actually Bill Gates sold off a suspiciously large number of shared in Feb. I wonder why? [yahoo.com]

This is getting old

[Anonymous Coward]

We all know that Vista sales will increase and XP sales will fall. We all know that however much Windows idiots say "I'm sticking with XP," it's really not their decision. They'll get Vista with their next computer, and they'll like it, because that's the only choice they'll have. And if not the next computer, certainly the one after that because the hardware won't be supported in XP.

So can we please stop getting these articles about Vista sales? It doesn't really matter. In 5 years Vista will be just as entrenched as XP and it's not interesting how fast it gets there. Especially when all the articles contradict each other. Every other day Vista sales switch from very bad to very good.

Maybe Vista does make sense

[eebra82]

Maybe this does make sense after all. Here's why:

Windows XP is a very mature operating system. People rarely experience lockups (I haven't had one for months), it looks OK, it's speedy with today's hardware and it is far more secure than it was a few years ago.

The point is that XP is good to those who currently use it. Those who want 'more' just get Vista. Maybe XP and Vista is going to co-exist longer than any of MS:es previous operating systems ever have before, simply because both products are good (or at least Vista will be in half a year or so). Previously, we had 2K and XP competing, and before that 9x/Me and 2K, where we had a clear winner in both operating systems. Now I can't say that Vista is a clear winner to XP, but rather a good 'alternative'.

Yes, Ubuntu and OSX are great alternatives, but it takes a lot to make a user switch an operating system entirely, so I am not taking this into account.

Re:Only 30%?

[maxume]

It's a matter of perspective; that 30% revenue growth is equivalent to all of Google's revenue for the quarter. It's hard to push an elephant.

Re:No!

[marcello_dl]

A lot of people seem to think it is harmful to your career to ally oneself with the technology that is still the overwhelming leader in the market. Personally I don't understand that.

If you don't understand that I have a fairly comprehensive explanation for you to download.

In quarkXpress 7 format only.

Re:No!

[tomstdenis]

I choose not to use Windows because as a developer it's not a useful OS in the slightest. That it costs more than Gentoo, is less standard compliant, and the target of more bugs [regardless of the quality of OSS that is] doesn't help either.

A lot of people use Windows not by choice but by the virtue of it's what came with their computer and they don't care to investigate alternatives [even if it's to their benefit].

It's the same reason people eat at fast food joints. It's convenient, around every corner, and seeking out alternatives means they have to do some thinking on their own, which is really scary.

Tom

Coupons, Coupons, Coupons

[Marcion]

Counting Coupons according to when they are redeemed is a way to spread out the data. It's a big game, no one outside of Microsoft really knows the real numbers, otherwise the shareholders would demand serious restructuring (kill Xbox, Zune, become MS Office company, return cash pile to shareholders, produce more Mac software etc).

Re:No!

[daeg]

I'm sure all of the engineers, factory workers, and shops that center around bicycles would like to disagree with you. I'm sure a lot of the European and Asian countries would also like to disagree with you, given that many of them have higher rates of bikes per capita than vehicles (not so in North America, except for a few cities perhaps). Bad analogy.

And a lot of people, at least here at Slashdot, make a good living administering Linux, so being knowledgeable about multiple operating systems is a good thing. If you can make $A administering Windows, and $B administering Red Hat, and $C administering FreeBSD, it stands to reason that if you know Windows, Red Hat, and FreeBSD, your pay, $D, should be $D > ($A, $B, $C). If Red Hat fell out of favor, you still have two other systems you can manage.

Besides, a 100% identical network isn't good practice, no matter what company you work in. You don't want every server to be impacted by the same security flaw on the same day. Competition to Microsoft is good for everyone, including Microsoft administrators.

Re:Only 30%?

[Rolgar]

What's the OEM price difference between Vista and XP. If Vista OEM is 50% or more expensive that XP when buying a new computer, then, sure they're getting more money, but they aren't moving any more copies than they were before. This was the whole point of the new OS, to milk more money from the same number of customers.

Re:No!

[jellomizer]

A lot of people seem to think it is harmful to your career to ally oneself with the technology that is still the overwhelming leader in the market. Personally I don't understand that.

It's kind of like being the the transportation industry, and choosing to specialize in bicycles...economically, it is not a very good plan.

As someone who makes a living progamming on different Operating Systems Every Day. There is a definate advantage having skills in the non-market leader products.
First You can charge more. .NET programmers are a dime a dozen. But for a good FORTRAN Developer that will cost more, and can't easilly be replaced. Or someone who can make heads or tails out of an RPG Data File. For many of these people with old systems moving to windows is much to expensive moving to Linux is much better, easier to port old software, current administration skill, etc... So learning different languages and systems is a real bonus. Even if it not and never will be #1. Also as technolgy advances a lot of things that were old become new again. People with knowlege in a wider skill set are much more adaptable to different systems. How many advanced windows users get fustrated just because a Linux distribution decides to put the Minamize, Maxamize, and close button on the other side of the windows. How many Mac Users or Linux Users get confused when working on different systems. The more you know the better you are at each one. Also it helps with administration even if you don't know the systems as well as an expert with you knowelge with other OS's it allows you to ask the right questions. Say I know the SEARCH command on VMS and I do a google search for VMS to Unix commands and I find that grep does the job of SEARCH. Or if I need to do some scripting on windows what I learned from the numerious SH scripts I can put into .BAT files. It really helps. Putting all your eggs into one OS even if it is the most popular one will lead you become obsolute rather fast.

Re:No!

[CogDissident]

Lets see you run some video games on Gentoo. Sure, M$ has an unstable unreliable operating system, but I don't want to have to spend an hour configuring my system every time I get a new game.

Re:Sketchy figures...

[draos]

That's not how it works. They offered upgrade coupons to PC buyers during the holiday season since the product wasn't out the door yet...essentially those users "bought" Vista in the form of a coupon in the third quarter. So now when they ship a copy of Vista to a coupon holder it is counted as sale made in the third quarter...this is a standard accounting practice that is accepted throughout the business world. They are looking at it, financially, as though they released Vista during the Christmas season rather than when they did because they ran a promotion that was equivalent from a marketing perspective. Because they are a public company they are required by law to look at it this way, only small businesses can use cost based accounting that records the sale as occurring when the money/product changes hands.

Remember

[geekoid]

accounting is funny stuff.

This goes for ANY company:
When a company seems to be doing better then the market indicates, look at the numbers very closly.

Were there 'expectations' lower than reasonable? Are they counting units moved to outlets, or the unit's then sold?

What is there deal with outlets? can they return unsold stock*? How many lisenses did DELL purchase that it's not using?

Re:Maybe Vista does make sense

[hexed_2050]

It is a clear winner. Sure people on Slashdot will be the first ones to tell you it's garbage, but if you actually sit down and really go through it and learn the new security measures in Vista, you will begin to love it as a system administrator.

Why do I say you'll love it as an administrator? Well let's just put aside for one second our gripes about Microsoft and the fact that they are a monopoly and just focus on comparing it to XP...

What is one of the most nagging, worst things that a system administrator will tell you he/she hates about XP? This is easy... It's the fact that it is almost impossible to log a person in as a 'normal user' in a corporate environment and not have them calling IT every two seconds to install a new piece of hardware or do something that a system administrator can only do. Therefore what ends up happening? Come on, we all know.. 99% of Windows users are logged in 24/7 as an administrator level account which allows people to pick up a ton of wanted gems such as malware, spyware, This all changes in Vista. After system admins sit down and really READ what is new and PROPERLY understand it, they will begin to love UAC because for once, Microsoft users will actually be able to be logged in as a simple user instead of an administrator all day long.

There are so many great things that Vista offers over XP, but UAC once you understand it is one of the best for the corporate environment once you understand it internally and how to harness it in a GPO domain environment.

Yes, I do wish that we could just deploy FC6 across our networks, but let's face it.. it's not happening anytime soon so I'll welcome Vista because it's light years ahead of XP in terms of assisting me do my job.

h

Re:No!

[Jearil]

Except back in the mid-late 90's and even into the early 00's, Quark was the standard for design and layout. Adobe had PageMaker, but real professionals used Quark.

So if you placed all of your important work into the defacto standard of the time, Quark, you'd be a bit behind right now as the industry has mostly moved on. I think what the GP was trying to make a point with, is no companies dominance lasts forever, so try not to tie yourself to heavily to one.

Re:No!

[e2d2]

If you don't understand that I have a fairly comprehensive explanation for you to download.

Yes but there is a difference between a technology causing harm to the industry and causing harm to you personally. For instance if I'm a developer working on Windows I won't be causing myself any harm. In fact I'd probably be helping myself.

A lot of "us" windows developers have been programming on it since before it became the "EVIL SATAN" often portrayed here on slashdot and make an excellent living at it. Can I program on Linux? Sure, I do so all the time at home, programming embedded devices and robots and I've released open source software under GPL license. Maybe one day I'll be able to work on them full time. But right now I work on the "Ford" of the industry. It's not unwise and it's not unethical. It's just reality. We deal with the reality of the industry, and that reality is that Windows dominates the market so it makes economic sense to use it.

I don't align my personal feelings with a technology, it's not wise.

 

Re:No!

[Maxo-Texas]

And that's a nice rational decision.
We make those kind of decisions all the time and there is nothing wrong with it.
There are probably a lot of windows users who really appreciate that you are a good windows developer.

As a developer, I'm typing on a windows machine right now tho I create java programs. I'm more of a project leader these days tho (havn't coded in months) and I like it. A fixed body of knowledge to learn and master (like the older programming languages) instead of the constant treadmill of learning things that are obsolete 12 months later.

As an end user, I've personally moved everything but everquest to applications that will run on any platform because I see that windows wants to move me to a tightly controlled environment that i pay a monthly subscription fee to use.

Re:Coupons, Coupons, Coupons

[Marcion]

Sure, I would not hang up the Xbox, but spin it out, look how well IBM have done, Printers became Lexmark, Laptops became Lenovo and so on. Applications is what Microsoft were good at and they need to get back to it and get on with them, making them faster, simpler and more collaborative, and sell them to anyone who will buy them including Mac, Linux, Symbian, embedded, mobile phones etc, if they don't then in 5-10 years they will find Adobe and Google will have redefined how to be productive and will have pulled the rug out under them.

Re:M$ is lying

[laffer1]

You contradict yourself. If they ordered a new PC with Vista, then they did order Vista. Just because they choose not to use it does not mean it doesn't count as a sale.

I can also explain the reasoning behind not upgrading. Many software applications do not run properly on Vista. Some require software upgrades. Schools have to roll out a lot of money to get new versions of software if they even exist. I am a sys admin for a computer science department. (labs + servers) We are 50/50 Mac/PC. We have no plans to upgrade to Vista, but plan on running XP for some time. The current plan this summer is to buy iMacs to replace our Dell optiplex systems and use boot camp. Actually, we are considering trying to triple boot Windows, Mac OS and Linux. Since they are Macs, they will not count in Microsoft's numbers.

I don't think Vista will be a disaster long term. Initially, after each Windows release I saw people complain and say this one is the one that will get another OS to take off, etc. When I upgraded to Windows 95, older geeks said I was stupid and it was not worth the upgrade. Likewise, Windows 98 was just a "rehash" of windows 95, Windows 2000 was just NT4 with graphical improvements (which is not true), and Windows XP wasn't any better than 2000. I've been discouraging users from upgrading to Vista for one reason. There aren't any drivers for sound cards or video cards worth a damn. My audigy actually drops out audio randomly and I have to reboot. This really sucks while watching a DVD or playing WoW. Industry doesn't want to pay for the interface changes Microsoft has made in Vista. Eventually, they'll have to. Until then, I can watch movies in MidnightBSD and try to use my wife's Mac to play games. (funny isn't it)

Re:Coupons, Coupons, Coupons

[arse maker]

Yes, if that means shareholders are short sighted idiots. With software the target is always moving, you have open office gaining traction and Linux gaining traction. Microsoft has something big... it's a 60 billion+ war chest... it's time to find more things to do. While Microsoft aren't the nicest company around (well what big companies are, anyone like their insurance company?) they are good at doing something well as long as they want to. It's in their interest to diversify and try to secure their future. Hell that's what IBM did, the largest revenue company in the world (last time I checked anyhow). They started their consultant business and that is now their most profitable department. Standing still is the death rattle of a company. Once you don't expand you get taken over... as a developer I know its 100x times easier developing an application to compete against an existing application than it is developing it from scratch (another argument against over ambitious patients, they should be there to help, not to hinder simple ideas being used, they need to take into account international conditions, it's not just in the west we are competiting).

Re:No!

[drinkypoo]

Speaking from experience I can tell you that this is not what happened. You can use the output of various Adobe programs inside of Quark, that's not the issue. The issue is that Quark went from being light, fast, and reliable to being a gigantic bloated pile of shit in which you couldn't fucking find what you were looking for and if you did the program would probably crash. This has left things open for Adobe to make InDesign into a big turd and STILL control the market, which is why I'm so pissed off at it these days (CS2, so far.)

Re:Well it figures

[Mr. Underbridge]

These are facts. Reported to the SEC. You can't call raw, concrete sales revenue/profit "astrotuf," especially when they provide the breakdown of numbers with coupons excluded. There isn't even any gray area left.

Facts are nothing without interpretation. The submission implies that a relatively modest increase in sales on the heels of the first new OS release in 6 years means that everything is fantastic over at Redmond. This indicates either presence of spin or lack of a brain. You pick. Coupled with the fact that the submitter is anonymous, I lean toward a PR campaign, which MS has been known to do in that fashion.

Just because you don't like Microsoft doesn't mean everything positive about them is astroturf. I'm hoping it's because you didn't bother reading the article,

I don't particularly care about MS, but lack of logic skills in reporting bugs me. The headline of the submission "Vista Sales Strong, Higher Than Expected" is simply not supported by the only externally available evidence ("Profits jumped 65% from the previous year") because Vista DIDN'T EXIST last year.

You want to do a real study, find out how Vista did vs. XP in terms of quarter-over-quarter earnings jump the first quarter after release. Let's not rely on intentionally-low earnings forecasts from MS that have room for built-in good news. Hell, maybe it would show that Vista is doing better. I really don't care. But let's have some intelligent, unbiased reporting and submissions that don't come from anonymous shills.

Sheesh. Basic logic skills are sorely lacking around here.

Re:No!

[e2d2]

That was a great argument and I see exactly what you are saying. I do see innovation being introduced in Linux and that makes me happy. I do see Linux surpassing Windows one day, but on that day Microsoft will proclaim Linux the greatest thing ever and reverse course. They are pretty slick. BUT eventually all things come to an end, especially undeserved positions of power. It's one thing to dominate a market on merit, it's another to dominate a market using a monopoly and strong arm tactics. Those tactics are coming back to bite MS in the ass these days.

I can see the writing on the wall, Windows is not the juggernaut it used to be. I just wanted to explain why windows developers do what we do. Many on here see us as either weak developers using VB to funk up a pathetic office app or simply industry shills. But we have motivations like every other man and woman.

Re:M$ is lying

[imsirovic5]

I happen to work on Wall Street, and the ignorance of how some people perceive the financial markets is just amazing. I am sure "surfduke" is way smarter than the analysts than the following Analysts that follow MSFT:

A. G. EDWARDS & SONS, INC. KEVIN BUTTIGIEG
ARGUS RESEARCH CORP. ROBERT BECKER
ATLANTIC EQUITIES CHRISTOPHER HICKEY
BANC OF AMERICA SECURITIES LLC. KIRK S. MATERNE
BEAR, STEARNS & CO. JOHN DIFUCCI
CANACCORD ADAMS PETER MISEK
CIBC WORLD MARKETS CORP. BRAD REBACK
CITIGROUP BRENT THILL
COWEN AND COMPANY WALTER PRITCHARD
CREDIT SUISSE - NORTH AMERICA JASON MAYNARD
CROWELL, WEEDON & CO. JAMES D. RAGAN
D. A. DAVIDSON & CO. ALAN L. DAVIS
DAVENPORT & CO. OF VIRGINIA, INC. F. DRAKE JOHNSTONE
E.K.RILEY INVESTMENTS, LLC ROBERT E. TOOMEY
FIRST ALBANY CORP. MARK MURPHY
FIRST GLOBAL STOCKBROKING LTD. SHASHIKIRAN RAO
FRIEDMAN, BILLINGS, RAMSEY & CO. DAVID M. HILAL
GLOBAL EQUITIES RESEARCH TRIP CHOWDHRY
GOLDMAN SACHS & CO. SARAH FRIAR
GRIFFIN SECURITIES, INC. CHRYSTYNA BEDRIJ
ICAP EQUITY RESEARCH RICHARD T. WILLIAMS
JPMORGAN ADAM HOLT
JYSKE BANK PER-ROBERT JACOBSEN
KINTISHEFF RESEARCH TSVETAN KINTISHEFF
LEHMAN BROTHERS ISRAEL HERNANDEZ
MCADAMS WRIGHT RAGEN SID PARAKH
MERRILL LYNCH KASH RANGAN
MORGAN STANLEY MARY MEEKER
NUTMEG SECURITIES JEAN WOPAT ORR
PACIFIC CREST SECURITIES BRENDAN J. BARNICLE
PACIFIC GROWTH EQUITIES YUN KIM
PIPER JAFFRAY MICHAEL J. OLSON
PRUDENTIAL EQUITY GROUP, LLC JOHN P. MCPEAKE
RAGEN MACKENZIE, A DIVSN OF WELLS FARGO TAUNYA R. SELL
RBC CAPITAL MARKETS (CANADA) STEPHEN WALKER
RBC CAPITAL MARKETS (US) ROBERT BREZA
ROCHDALE SECURITIES LLC DAVID ELLER
SANFORD C. BERNSTEIN & CO., LLC CHARLES J. DI BONA
SOLEIL-ONE-ON-ONE RESEARCH DAWN S. TALBOT
STANFORD GROUP COMPANY NEIL J. HERMAN
THOMAS WEISEL PARTNERS TIM E. KLASELL
UBS (US) HEATHER A. BELLINI
WILLIAM BLAIR & COMPANY, L.L.C. LAURA J. LEDERMAN

Not to mention countless buy side institutions with trillions dollars in combined assets such as hedge and mutual funds. At the moment of this writing the stock is up $1.24 or roughly 11 billion dollars in market cap. I guess they are not reading slashdot. I wonder why don't all the people on here that forecast demise of MSFT put their money where their mouth is and just short the stock, or even better buy some put options. Go ahead take a second mortgage and bet your life against the Company if you really believe MSFT is doomed. I used to be a frequent visitor to Slashdot since I always valued input of some really smart people on vide-variety of mostly scientific topics. But blatant, childish attacks on MSFT and herd mentality on some of the topics made me visit this website less and less. And its amazing some other companies, like AAPL for example seem to be darlings on this board. And its surprising to me that AAPL stands higher on moral and idealistic scale even though it is a fact that AAPL has been accused of many monopolistic practices, it is a fact that Steve Jobs is a liar and a thief (anyone that does thinks that a CEO of a major corporation has no idea what option backdating is needs a reality check.). It is sad to see such consistent high scores on comments that exhibit such level of herd mentality on this website. Anyway I will stop now, I am sure I provided enough material to get moded as a troll. Its an earning season and if I want to get out of the office by midnight I need to stop wasting my time here and go back to work...

Re:Well it figures

[X]

His problem though is that those were internal forecasts, and since they weren't public they could always have been adjusted after the fact to make it sound better than it was.

Re:Well it figures

[encoderer]

What's your point? Do you understand what you're talking about? Most companies only begin to pay dividends to their shareholders when they're no longer able to grow the business and therefore their capital has more utility value to investors in the form of dividends than it does in the form of re-investments designed to push stock prices up.

Most investors would GLADLY sacrifice the paltry amount they make in dividends in exchange for the company growing their business (and thusly their stock price).