The Microsoft juggernaut chugged ahead of Wall Street forecasts to post another staggering quarterly earnings report. But, yet again, the executives up front in the engineer's cab said the train will soon be slowing.
The software superpower said on Wednesday that its earnings rose to US$1.34 billion, or 50 cents per share on a diluted basis, from $1.04 billion, or 40 cents a share, a year earlier. Revenues rose 18 percent to $3.77 billion from $3.21 billion.
The per-share earnings of 50 cents compared with Wall Street forecasts of 48 cents, according to the First Call research service.
But Microsoft chief financial officer Greg Maffei said fiscal fourth quarter revenues would be roughly flat compared to the third quarter. He said earnings in the first and second quarters of fiscal 1999 would remain flat, too, although there could be a modest "seasonal uptick" in revenues in the second quarter.
Even so, the company said this quarter's results showed consumer demand remains strong for its products.
"But it is critical to note that our growth has slowed for each of the last four quarters, and we are likely to experience slower growth for the balance of calendar 1998," said Maffei.
Redmond said business conditions were strong in most regions, particularly North America, but it remained concerned about Asia.
In anticipation of the earnings report, which was issued after the market closed, Microsoft stock rose nearly $4 to $98.75 on the Nasdaq. It was the fifth most active issue on the Nasdaq with volume of 20 million shares. In after-hours trading, the stock edged up to $99.
Another Nasdaq giant, Intel, gained 6.5 percent to close at $84.06.
Despite a slowdown in PC sales growth that has afflicted other computer industry companies like Intel Corp. and Motorola Inc., Microsoft's core operating systems and applications businesses have remained strong.
In particular, Microsoft has enjoyed strong sales of its Office and BackOffice products, as well as its Windows NT server software for use on computer networks.
Microsoft sales and marketing expenses also have declined due to a lack of new products, although that is expected to end soon as the company ramps up a publicity blitz for its forthcoming Windows 98 operating system, due out in June.
