Microsoft declares a loss for first time ever

Published:  20 Jul at 9 AM

Microsoft has declared a quarterly loss for the fist time ever. The computing giant lost $492 million in the second three months of 2012 compared to a $5.9 billion profit announced for the same quarter a year ago. The main reason for this is a decision by the company to write down the value of online advertising business Aquantive.

Aquantive was taken over by Microsoft in 2007 in a deal worth $6.3 billion. However it has since struggled to keep up with its main rival Google. Although this is the first time the company has been forced to declare a loss since 1986 when it floated on the stock market, Microsoft said revenues for the quarter ending in June increased to $18.06 billion, a rise of 4 per cent.

The firm is still doing very well in some areas although it has been struggling to keep people interested in its Windows operating system which was once dominant in the personal computer market.

In October, Microsoft will launch Windows 8 which it claims is the most significant redesign to the system in a decade. The OS will now be able to work on tablets which are currently the computer market’s fastest growing sector along with smartphones.

Microsoft is also due to make its tablet debut with the Surface. Although the company has declared it first loss, profits were still higher than expected by analysts and shares were up by 1.6 per cent.