Analyst Jason Maynard says the $9.2 billion in total revenue is well above his $8.6 billion estimate. The 34 cents operating earnings per share beat his 29 cents estimate. Maynard says revenue increased 17% annually, driven by strong sales of Windows XP, Office 2003, the server business, and better-than-expected Xbox sales.
Maynard notes Microsoft's unearned revenue balance declined by $326 million, which is better than his forecast for a decline of $450 million to $500 million. Due to outperformance in the third quarter, he raised the $35.8 billion fiscal 2004 (June) estimate to $36.5 billion, and upped the $1.20 earnings per share estimate to $1.26. He raised the $37.5 billion fiscal 2005 revenue estimate to $38.2 billion, and upped the $1.27 earnings per share estimate to $1.33.
He continues to believe Microsoft shares are undervalued, and he has a $30 price objective.