Microsoft Promises Cheaper Windows 8 Tabs

Microsoft has announced revenue of $20.49bn for its third quarter ended 31 March, an increase of 18 per cent year-on-year.

The Entertainment and Devices division, which includes Windows Phone devices and with games console, posted revenue of $2.53bn, an increase of 56 per cent from a year earlier. The Windows division, including Surface tablets and PCs, saw a year-on-year revenue increase of 23 per cent to $5.7bn.

Windows Phone momentum

Although Windows Phone is trailing far behind Android and iOS, Steve Ballmer, CEO, said on an earnings call that he is happy with its performance so far: “Momentum with Windows Phone continues to build. The device is now available in a broad range of price points. We’re receiving great reviews and carrier support continues to grow.

“We now have over 10 per cent share in several countries, but realise there is still a lot of work ahead to break through in some key markets. The growing awareness of Windows Phone has sustained innovation from our hardware partners, and we feel well-positioned to continue our momentum.”

The companys CFO, Peter Klein, who is stepping down at the end of the financial year, said he expects the final quarter revenue growth in the Enterainment and Devices division to be in the mid-teens. In the Windows division, he said that manufacturer revenues will be hit by declining sales of PCs but it will be working to increase its tablet share.

Low-end Windows 8 tablets
Asked how Microsoft intends to increase its share of the tablet market, Klein  said that Microsoft has already increased distribution on Surface to 22 countries and 70 retailers, “and we’ll continue to look to expand that. Not just expanding, but improving the experience. And that’s true not just for Surface, but for broadly Windows 8 devices. So we’ll be investing against that for both Surface and a broader array of Windows 8 devices at multiple price points, including lower price points going forward.”

“The biggest thing we’re doing is helping OEMs develop new and improved user experiences across the board, across size, across price point and deliver a really compelling Windows 8 experience,” Klein said. “And it’s not just the devices. It’s chips, it’s the apps, it’s the buying experience, it’s the user interface. So we’re really focused on all five or six of those dimensions going forward.

“As we look towards the future, we have a solid foundation of products and services in market, and our leadership team is collectively focused on advancing every one of our businesses. You can expect to hear more about the specific actions we are taking over the next few months.”