microsoft analysis report

microsoft analysis report - Company Note July 20, 2007...

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Page 1 of 9 Microsoft Corporation Piper Jaffray does and seeks to do business with companies covered in its research reports. As a result, investors should be aware that the firm may have a conflict of interest that could affect the objectivity of this report. Investors should consider this report as only a single factor in making their investment decisions. This report should be read in conjunction with important disclosure information, including an attestation under Regulation Analyst certification, found on pages 7 - 9 of this report or at the following site: http://www.piperjaffray.com/researchdisclosures. Customers of Piper Jaffray in the United States can receive independent, third-party research on the company or companies covered in this report, at no cost to them, where such research is available. Customers can access this independent research by visiting piperjaffray.com or can call 800 747-5128 to request a copy of this research. Microsoft Corporation (MSFT - $31.51) Outperform Volatility: Low Catalyst Rich FY07 Comes To A Close, But Momentum Continues Into FY08 KEY POINTS: Microsoft reported a solid June quarter due to continued demand for Vista and outperformance in the business and online services segments. Guidance for Q1 and FY08 is in line with consensus. Increase in unearned revenue was $850m above most Street ests. Conclusion. While the end of FY07 marks the end of a catalyst rich year for Microsoft ( Vista Office launch, etc), FY08 holds various catalysts that we believe will continue to allow Microsoft to meet or slightly exceed estimates through the year. Specifically, several product launches and the closing of the aQuantive deal (expected to close in Q1) will likely prove to be drivers in FY08. What Puts Fuel In The Tank In FY08? Looking forward to Microsoft's FY08, the company guided essentially in line with Street expectations. On a high level, FY08 results will be driven by new products that build on Microsoft's flagship rollouts in FY07: Office 2007 and Windows Vista . Among them are: Windows Server 2008 , SQL Server 2008, Visual Studio 2008 , Office PerformancePoint Server 2007 , and Microsoft Dynamics Live CRM . We believe these products will not only build on the successful launches of Office and Vista , but will also serve to promote more widespread adoption of the flagship offerings, especially in the business portion of Microsoft's Client segment. Additionally, Vista will see an SP1 upgrade during FY08, which should add fuel to the Vista upgrade tank. Finally, Halo 3 is expected to launch Sept. 25, which should give the Entertainment and Devices division a steady revenue stream through the holiday season. June Quarter Results.
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microsoft analysis report - Company Note July 20, 2007...

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