Shares in Microsoft Corp powered to a new 12-month high in busy pre-open trading on Friday on the strength of the fiscal third quarter figures announced after the market closed on Thursday night. The shares put on $3 to $112. Microsoft’s chief financial officer said he expected current – fiscal fourth – quarter results to be off slightly from third quarter profits of $562m. The third quarter earnings were three cents better than mean consensus estimates of 23 analysts. The Redmond, Washington-based software leader confessed itself pleased with results that were strong across many product lines and geographies. Strong sales of Windows95, which is now pre-installed on 70% of new personal computers led the way, but sales of Microsoft’s desktop applications also soared, with Office surpassing the $1,000m level in a quarter for the first time. Microsoft is bullish about prospects for the year starting July 1, particularly as the company launches the new version Windows NT with the Windows95 user interface. The company noted that research and development costs rose 15% to $364m in the third quarter compared with the second quarter, and they will continue to rise sequentially, although not at that rate. Under a new accounting procedure, Microsoft is recognizing 80% of revenues immediately for Windows NT system and for Windows95 shipped through the OEM channel, with the remaining 20% recognized over its estimated 24-month life.
