Microsoft Corporation (NASDAQ:MSFT) Is Among The Top 5 Performers on the Dow in 2012
Microsoft Corporation’s (NASDAQ:MSFT) shares have been showing solid uptrend since the beginning of this year. The stock started the year at around $26, moved up to its multi year high of $32.95 in mid March. The stock has gained about 22.50% so far this year, 2.50 times the gain for the Dow Jones Industrial Average.
The stock rose over 3.50% on Apr 20, 2012 after the tech bellwether reported a better than estimated third quarter earnings driven by strong performance at Windows, overshadowing weak performance from Xbox and Kinect.
The company posted net income of $5.1 billion, or 60 cents a share, down from a year ago profit of $5.2 billion, or 61 cents a share. Last year’s results were boosted by a tax benefit of $461 million, or 5 cents per share. Revenue during the latest quarter grew 6% year-over-year to $17.4 billion.
Analysts were estimating the company to report 58 cents per share on revenue of $17.2 billion.
Most of Microsoft’s businesses posted solid sales growth compared with last year: 14% for the server and tools division; 9% for the business sector, which includes Office; 6% for online services. Microsoft’s Windows division sales increased by 4% year-over-year to $4.6 billion.
But the gaming business, which has recently been a strong point for Microsoft, weakened compared to last year. Sales in that division fell 16%, to $1.6 billion.
Last week, Microsoft announced the formation of a strategic partnership in a new Barnes & Noble subsidiary. The partnership will accelerate the transition to e-reading, which is revolutionizing the way people consume, create, share and enjoy digital content. The new subsidiary, referred to in this release as Newco, will bring together the digital and College businesses of Barnes & Noble. Microsoft will make a $300 million investment in Newco at a post-money valuation of $1.7 billion in exchange for an approximately 17.6% equity stake. Barnes & Noble will own approximately 82.4% of the new subsidiary, which will have an ongoing relationship with the Company’s retail stores. Barnes & Noble has not yet decided on the name of Newco.