Fast Company

Microsoft, Amazon Post Strong First Quarters on the Strengths of Windows 7 and Kindle

KindleTwo of our Most Innovative Companies, Amazon and Microsoft, are among the many that reported their quarterly financial earnings today. And, because our list is exactly that good, both are showing healthy growth on the strength of new or new-ish products.

Microsoft's overall revenue is up 6% from this quarter last year, and would actually have been 8% but the purchases of the upcoming Office 2010 suite had to be deferred until next quarter, when the product is actually released. That bests analysts predictions, and is largely due to the strong release and reception of Windows 7. Microsoft noted that Windows 7 is now on 10% of all computers--a big gain, and more than all versions of Apple's Mac OS. Xbox was also a strong performer, with unusually large profits coming from non-game purchases in Xbox Live.

Microsoft's next quarter will likely be dominated by Office 2010, and the quarter after that will largely depend on the launch of the highly anticipated Windows Phone 7.

Amazon also showed big gains--net sales are up 46%, and operating income is up 62%. Net income is up 68%. These are all huge numbers for Amazon, and the company was eager to put the spotlight on Kindle, especially after the iPad's blockbuster launch that had many predicting Kindle's demise. The company announced that the Kindle store has now passed 500,000 titles (compare that with the iBookstore's 60,000), including 100 of the 111 New York Times bestsellers. The company also referred to the Kindle as its "#1 bestselling product," but as is Amazon's wont, neglected to provide any hard sales numbers.

Amazon is in for a fight next quarter with the iPad, but it's an interesting one, given that Amazon has a Kindle app available for the tablet. iPad sales may or may not hurt Kindle reader sales, but they also provide an opportunity for Amazon to sell more e-books, so it's not a clear battle.

Dan Nosowitz, the author of this post, can be followed on Twitter, corresponded with via email, and stalked in San Francisco (no link for that one--you'll have to do the legwork yourself).

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