Microsofts mixed bag of results

Microsoft has just announced their results for Q4 2005 and it was a mixed bag to say the least. And analysts were disappointed that their revenues came in below their expectations. The problems apparently lay with Xbox 360 delays and MSN stumbles.

On the Xbox 360 side Microsoft admitted that sales were lower than they hoped. They sold 1.5M by end 2005: 900,000 in US, 500,000 in Europe and 100,000 in Japan. So, if you want to buy an Xbox 360 go to Tokyo. But Microsoft promise they'll sell 4.5-5.5M by end June!

And that's really the problem, cos Microsoft just can't quite seem to get their production right. So even today if yo wanna buy an Xbox anywhere other than Tokyo in any normal shop - go blow! And they are blowing their opportunity, as even they were the first to point out that one of the best weapons they had against the Playstation 3 was the fact that they launched so much earlier.

Well, when it comes to it launching that's one thing, but there's no beating actually supplying your product early if you really want to steal a march on the next guy. Given that the Playstation 3 will now be out in a few months Microsoft may even have blown their advantage.

Then comes MSN. Microsoft have seen revenues dip 3% from a year ago as they struggle to migrate their revenues from dial-up to ad based portal. Add to that the fact that they have lost the ad based part in their shift from Yahoo ads on MSN to Microsofts new ad technology called Adsense and you have to giggle a little at the software giants fumbles. I mean, is this stuff really rocket science or is Microsoft fighting on too many fronts/having troubles scaling/just boobing around.

But on the flip side came the good news, which almost made up for the Xbox/MSN boobs. For thanks to the healtch of the PC market (which pleased analysts no end) Microsoft's consumer business saw double digit growth and so too the server and tools division thanks to a successful launch of the latest flavour of SQL Server.

And Microsoft were also quick to tell us that a couple of their newer divisions went into profit for the first time - the medium sized business division and the mobile and embedded systems division. That's nice for them cos these two divisions have plenty of growth left in them (sorry Nokia) and Microsoft should be well suited to this game (sorry Sage too - who?).

And lastly the Microsoft execs left analysts with a warmish feeling as they raised projections for 2006. Mind you, given the flood of new products from Microsoft this year, you'd hope *** well hope so. And given their extroardinarily unimpressive share price performance over the last 3 years (nearly every major indicese beat them) - they had better outperform. So roll on 2006 and good like Bill and Stevie (that's Balmer not Wonder silly).