Microsoft Announces Record First-Quarter Revenues and Income Continuing success of Windows 95 and Windows NT accelerate earnings growth to 22%

Redmond, Washington, October 21, 1996 — Microsoft Corporation today announced net income of $614 million, and earnings per share of $0.95 for the quarter ended September 30, 1996, a 22% increase over the $0.78 reported for the corresponding quarter last year. Revenues totaled $2.30 billion, representing a 14% increase compared to the $2.02 billion during the same quarter last year.

“We are pleased with these results,” noted Mike Brown, Chief Financial Officer. “Revenues were up nicely over last year’s strong first quarter, when the Microsoft(r) Windows(r) 95 operating system was introduced. This quarter, the company posted solid results across a wide range of businesses, including operating systems, personal productivity tools, and enterprise solutions.”

“We shipped version 4.0 of Windows NT(r) this quarter, and the momentum behind the product is outstanding,” said Jeff Raikes, Group Vice President, Sales and Marketing. “Corporate customers made the decision to adopt Windows NT Servers and Workstations in record numbers, driving 19% revenue growth over last quarter in the U.S. and Canada. Sales of Windows NT Server grew at nearly double the rate of other operating system environments. Additionally, sales of SQL Server(tm) nearly doubled over the last year.”

“Microsoft Internet Explorer 3.0 is on a roll,” said Bob Herbold, Chief Operating Officer. “It was released to rave reviews, winning seven of eight (tied the eighth) major head-to-head product reviews by industry and business publications. More than three million customers have downloaded Internet Explorer in just eight weeks, and major corporations are beginning to standardize on it. Internet developers are adopting it, too, with more than 300,000 web designers signed up for our site builders program. The outstanding success of this product affirms the strength of our Internet commitment and the value of our research and development efforts.”

In other news from the quarter, the company strengthened its cross-platform commitment by announcing a version of Microsoft Internet Explorer for UNIX, along with updated versions for Macintosh and Windows 3.1. The momentum for Internet Explorer 3.0 continued through the quarter, with AT & T and Microsoft agreeing to jointly promote and distribute Microsoft Internet Explorer 3.0 with AT & T WorldNet(r) Service. In related news after quarter end, Prodigy Inc. announced a cross-distribution agreement whereby Microsoft Internet Explorer 3.0 will be the default browser for Prodigy’s upcoming Internet-based service. Also during the quarter, Microsoft announced plans to transition specifications and appropriate technology for ActiveX(tm) controls to an independent industry-standards body, as part of the company’s vision to make ActiveX an open industry standard.

Subsequent to the quarter’s end, Microsoft Corp. unveiled the new Web-based MSN(tm), The Microsoft Network, featuring new services, original entertainment programming and an exciting new program viewer that puts MSN members just one click away from any major area on MSN or any other site on the Internet. Microsoft also announced Office 97, Developer Edition, a new tool for the more than one million developers building solutions with Microsoft Office .

Founded in 1975, Microsoft (NASDAQ “MSFT”) is the worldwide leader in software for personal computers. The company offers a wide range of products and services for business and personal use, each designed with the mission of making it easier and more enjoyable for people to take advantage of the full power of personal computing every day. For more information about the Microsoft Finacial Forum please visit

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