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oxconn, Microsoft and Intel just reported financial results, and things look different. Apple is more profitable than Microsoft, MSFT’s most profitable division are toys and Intel says server growth for the mobile web is driving its growth.
Foxconn financial results
the world’s manufacturer of all things tech recently posted its latest earnings report. TechEye points out that despite inconveniences like having to pay workers a slightly larger pittance and give them better working conditions, Foxconn has announced a 53% rise in consolidated revenues for 2010. Terry Gou‘s company’s gross profit for the twelve months increased by 58.5% to NT$100.9 billion from NT$63.6 billion in 2009.
Digitimes says the figures are all better than market watchers’ forecasts. Market watchers originally expected rising labor and component costs would seriously impact Foxconn’s profitability in 2010, but the company’s strong revenues last year still managed to boost its overall profitability despite a drop of 1.37 percentage points in its gross margin from the 2009 level to 8.15%.
Microsoft
Microsoft’s (MSFT) profits grew 3% during its fiscal 3rd quarter ending March 31, 2011. During this period, the software giant racked up $5.23 billion in profits, while revenues reached $16.43 billion, a 13 percent climb. These profits came thanks to strong performance from some nontraditional divisions.
MSFT’s Entertainment and Devices Division provided the biggest revenue gain. The home of Xbox and Kinect, Ballmer’s boys motion-sensing game controller increased sales by 60 percent to $1.94 billion. This is the smallest of Microsoft’s product divisions so it only generated 11.8 percent of overall sales. According to CNET. Kinect drove sales, selling 2.4 million units in the quarter according to the New York Times. CNET reports the company sold 2.7 million Xbox 360 consoles in the quarter, a 79 percent increase from last year.
Microsoft‘s second-largest revenue generator this quarter was the Windows and Windows Live Division which had revenue of $4.45 billion. This represents a 4 percent decrease from last year’s $4.65 billion and net income fell 10 percent. According to CNET Redmond says Windows is the fastest-selling operating system in history with 350 million licenses sold.
The Server and Tools Division saw the next best performance. The home to Windows Server had sales of $4.1 billion, up 11 percent from a year ago. Profit for the unit climbed 12 percent. CNET says business adoption of Windows Server, SQL Server and System Center lifted the division’s results.
At the Business Division, home of Office, Microsoft’s revenue grew 21 percent from last year according to the NYT. The NYT says the company’s Office software has no significant competition revenue grew to $5.25 billion. Office 2010 is the fastest-selling version of Office ever, Microsoft said, with businesses deploying the software at five times the rate of its predecessor.
Microsoft’s smallest revenue generator the Online Services Division, home of Bing gained 14 percent in revenue to $648 million from $566 million.TechEye reports that Bing increased its share of the search market but Microsoft spent so much on promotion the division saw operating losses of over $700 million. Ballmer’s partners are not happy with these results. Two years ago, Microsoft and Yahoo inked a deal to use MSFT technologies for Yahoo’s search to help both fight off rival Google. However, Yahoo’s chief executive, Carol A. Bartz, said that the partnership had not yielded the expected financial results for Yahoo and that technical glitches by Microsoft were to blame according to the NYT.
Intel
Chip giant Intel (INTC) has finally found a way into the mobile market. After years of trying to get its Atom chips into mobile devices, they are profiting from the demand for servers to feed the mobile devices. Intel Chief Financial Officer Stacy Smith told Bloomberg that the spread of mobile devices fuels “explosive” growth for processors used in data centers. “There’s a significant, maybe even an insatiable, demand driver for more and more performance and computing power that’s moving into the cloud,” Mr. Smith told Bloomberg. “What gets lost is the explosive growth of all of these devices connecting to the Internet is driving a $10 billion dollar server business.” Intel recently reported that its second-quarter revenue will be $1 billion more than analysts had estimated, in part driven by the data center boom.
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Ralph Bach has been in IT long enough to know better and has blogged from his Bach Seat about IT, careers, and anything else that catches his attention since 2005. You can follow him on LinkedIn, Facebook, and Twitter. Email the Bach Seat here.
Stacey Higginbotham at GigaOm points out a report from UK analyst firm Informa Telecoms & Media which says that Internet traffic will grow seven-fold between 2010 and 2015 to reach roughly 1.2 zettabytes globally and that Asia will lead the growth.
According to the report, the amount of Internet and service traffic will vary greatly from region to region and, despite the focus on the U.S., Asia will be the larger region in terms of traffic by 2015. Asia Pacific’s share will have increased to 42% of global Internet traffic by virtue of the sheer growth in user numbers that this region will see over the forecast period. “Much of the hype about Internet traffic growth continues to come from the U.S. and Silicon Valley, but it is the Asian Internet users that are generating the most traffic. This will only become pronounced over the next few years, as the region’s Internet penetration grows”, comments Giles Cottle, Senior Analyst at Informa Telecoms & Media.
