25 April 2008

Microsoft on the Rocks?

Hardly, with a quarterly profit of $4.39 billion, but this is interesting:

Sales in the division selling Office and other business applications fell, hit by lower demand.

As was this:

One factor denting profits was a $1.42bn fine imposed by the European Commission for breaching competition rules.

Put like that, the fine was a significant chunk of Microsoft's profits. Maybe it actually felt it this time.


Anonymous said...

I don't know upon what basis courts determine the size of a fine, but it would seem sensible to fine corporates x% of their annual profit (or maybe their last annual profit to avoid any creative accounting). It would be more meaningful to many people to hear that Microsoft were fined 30% (or 3% or 0.0003%) of last year's profits than to hear that they were fined $xxx.

Glyn Moody said...

In fact they base it on turnover, which is even more painful. I think the maximum is 10%, but I'm not sure on that figure. Microsoft got hit for less, but still quite significant.