Microsoft has posted its first quarterly loss in its 26 years -
Microsoft has posted its first quarterly loss in its 26 years as a public company as it declared a struggling online ad business a bust and prepared for one of the biggest product updates in its history.
The software company had warned two weeks ago that it would take a $6.2 billion charge in the April-June quarter because its 2007 purchase of online ad service aQuantive failed to help it compete with Google Inc. The amount reflected the bulk of the $6.3 billion it paid for aQuantive.
The purchase of aQuantive, Microsoft's most expensive deal at the time, was supposed to help Microsoft boost its online ad business and mount a more serious challenge to Google. But the division housing aQuantive continued to post losses — totaling more than $9 billion since the company bought aQuantive, not including the charge.
By contrast, Google has widened its lead in the growing online ad market, thanks in part to its purchase of DoubleClick for $3.2 billion about eight months after Microsoft took control of aQuantive.
Google's search engine, a major vehicle for selling ads, has remained strong, while Microsoft's Bing search engine saw its market share drop slightly to 26 percent, from 27 percent a year ago. The Bing figures include searches through business partner Yahoo Inc., which has been using Microsoft's search technology for nearly two years.
The aQuantive setback didn't faze investors, who have been used to years of troubles in Microsoft's online ad business. Investors usually focus on what lies ahead for a company instead of dwelling on past mistakes. Despite the loss, Microsoft's stock was up 72 cents, or 2.4 percent, at $31.39 in after-hours trading following the announcement.
Read more -
http://news.yahoo.com/microsoft-reports-first-loss-public-company-200908715--finance.html?_esi=1
Microsoft has posted its first quarterly loss in its 26 years as a public company as it declared a struggling online ad business a bust and prepared for one of the biggest product updates in its history.
The software company had warned two weeks ago that it would take a $6.2 billion charge in the April-June quarter because its 2007 purchase of online ad service aQuantive failed to help it compete with Google Inc. The amount reflected the bulk of the $6.3 billion it paid for aQuantive.
The purchase of aQuantive, Microsoft's most expensive deal at the time, was supposed to help Microsoft boost its online ad business and mount a more serious challenge to Google. But the division housing aQuantive continued to post losses — totaling more than $9 billion since the company bought aQuantive, not including the charge.
By contrast, Google has widened its lead in the growing online ad market, thanks in part to its purchase of DoubleClick for $3.2 billion about eight months after Microsoft took control of aQuantive.
Google's search engine, a major vehicle for selling ads, has remained strong, while Microsoft's Bing search engine saw its market share drop slightly to 26 percent, from 27 percent a year ago. The Bing figures include searches through business partner Yahoo Inc., which has been using Microsoft's search technology for nearly two years.
The aQuantive setback didn't faze investors, who have been used to years of troubles in Microsoft's online ad business. Investors usually focus on what lies ahead for a company instead of dwelling on past mistakes. Despite the loss, Microsoft's stock was up 72 cents, or 2.4 percent, at $31.39 in after-hours trading following the announcement.
Read more -
http://news.yahoo.com/microsoft-reports-first-loss-public-company-200908715--finance.html?_esi=1
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