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Microsoft Earnings Should be Strong

  • Reuters, Wednesday, January 23, 2008 11:33 AM
The tech sector is reeling on Wall Street and could use some good news when Microsoft and Google deliver fourth-quarter earnings later this week. Analysts expect Microsoft to report a sharp rise in profit on Thursday, boosted by strong PC sales with bundled versions of its Windows operating system and Office software.

Considering the widespread recession fears among investors, the company's full-year outlook will be key, but analysts expect that strong PC sales figures released last week indicate a healthy fourth quarter for the world's largest software maker. Reuters says that analysts on average expect Microsoft to deliver a 66 percent rise in net profit to $4.35 billion.

But investors will also look for improvement in Microsoft's money-losing Internet division, which the company has said represents a huge part of its future. The fourth quarter was the first since Microsoft's $6 billion acquisition of aQuantive, one of the largest digital advertising firms. The company has also made a large Web syndication deal with media giant Viacom during the most recent quarter.

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