Will the Vista nightmare ever end for Microsoft?!?!?



Microsoft Reports 27% Revenue Growth; Fastest First Quarter Since 1999

Broad-based strength drives operating income and EPS growth each in excess
of 25%

REDMOND, Wash. -- October 25, 2007 -- Microsoft Corp. today announced
revenue of $13.76 billion for the quarter ended September 30, 2007, a 27%
increase over the same period of the prior year. Operating income, net
income and diluted earnings per share for the quarter were $5.92 billion,
$4.29 billion and $0.45, respectively.

"This fiscal year is off to an outstanding start with the fastest revenue
growth of any first quarter since 1999," said Chris Liddell, chief financial
officer at Microsoft. "Operating income growth of over 30% also reflects
our ability to translate revenue into profits while making strategic
investments for the future."

Microsoft's businesses of Client, Microsoft Business Division, and Server
and Tools grew combined revenue in excess of 20%, and experienced robust
demand for Windows Vista, the 2007 Microsoft Office system, Windows Server,
and SQL Server.

"Customer demand for Windows Vista this quarter continued to build with
double-digit growth in multi-year agreements by businesses and with the vast
majority of consumers purchasing premium editions," said Kevin Johnson,
president of the Platform and Services Division at Microsoft.

During the quarter, Microsoft's two consumer focused divisions passed
milestones with the successful close of the company's largest ever
acquisition, aQuantive, and Halo 3 achieving the biggest entertainment
launch day in history.
"Backed by an amazing product line-up, our sales force, marketing teams, and
partners delivered another excellent quarter," said Kevin Turner, chief
operating officer at Microsoft.

Business Outlook

Microsoft management offers the following guidance for the quarter ending
December 31, 2007:

- Revenue is expected to be in the range of $15.6 billion to $16.1 billion.
- Operating income is expected to be in the range of $5.9 billion to $6.1
- Diluted earnings per share are expected to be in the range of $0.44 to

Management offers the following guidance for the full fiscal year ending
June 30, 2008:

- Revenue is expected to be in the range of $58.8 billion to $59.7 billion.
- Operating income is expected to be in the range of $23.3 billion to $23.7
- Diluted earnings per share are expected to be in the range of $1.78 to

The foregoing full fiscal year guidance includes approximately $85 million
of estimated integration costs and in-process research and development
expenses, or a $0.01 impact to diluted earnings per share, due to the
acquisition of aQuantive.

Webcast Details

Microsoft will hold an audio webcast at 2:30 p.m. PDT (5:30 p.m. EDT) today
with Chris Liddell, senior vice president and chief financial officer, Frank
Brod, corporate vice president and chief accounting officer, and Colleen
Healy, general manager of Investor Relations, to discuss details of the
company's performance for the quarter and certain forward-looking
information. The session may be accessed at http://www.microsoft.com/msft.
The webcast will be available for replay through the close of business on
October 25, 2008.

About Microsoft

Founded in 1975, Microsoft (Nasdaq "MSFT") is the worldwide leader in
software, services and solutions that help people and businesses realize
their full potential.

Forward-Looking Statements

Statements in this release that are "forward-looking statements" are based
on current expectations and assumptions that are subject to risks and
uncertainties. Actual results could differ materially because of factors
such as:

- challenges to Microsoft's business model;
- intense competition in all of Microsoft's markets;
- Microsoft's continued ability to protect its intellectual property rights;
- claims that Microsoft has infringed the intellectual property rights of
- the possibility of unauthorized disclosure of significant portions of
Microsoft's source code;
- actual or perceived security vulnerabilities in Microsoft products that
could reduce revenue or lead to liability;
- government litigation and regulation affecting how Microsoft designs and
markets its products;
- Microsoft's ability to attract and retain talented employees;
- delays in product development and related product release schedules;
- significant business investments that may not produce offsetting increases
in revenue;
- changes in general economic conditions that affect demand for computer
hardware or software;
- adverse results in legal disputes;
- unanticipated tax liabilities;
- Microsoft's consumer hardware products may experience quality or supply
- impairment of goodwill or amortizable intangible assets causing a charge
to earnings;
- exposure to increased economic and regulatory uncertainties from operating
a global business;
- geo-political conditions, natural disaster, cyber-attack or other
catastrophic event disrupting Microsoft's business;
- acquisitions and joint ventures that adversely affect the business;
- improper disclosure of personal data could result in liability and harm to
Microsoft's reputation;
- sales channel disruption such as the bankruptcy of a major distributor;
- implementation of operating cost structures that align with revenue

For further information regarding risks and uncertainties associated with
Microsoft's business, please refer to the "Management's Discussion and
Analysis of Financial Condition and Results of Operations" and "Risk
Factors" sections of Microsoft's SEC filings, including, but not limited to,
its annual report on Form 10-K and quarterly reports on Form 10-Q, copies of
which may be obtained by contacting Microsoft's Investor Relations
department at (800) 285-7772 or at Microsoft's Investor Relations website at

All information in this release is as of October 25, 2007. The company
undertakes no duty to update any forward-looking statement to conform the
statement to actual results or changes in the company's expectations.

For more information, financial analysts and investors only:
Colleen Healy, general manager, Investor Relations, (425) 706-3703

For more information, press only:
Rapid Response Team, Waggener Edstrom Worldwide, (503) 443-7070,
(e-mail address removed)

Note to editors: If you are interested in viewing additional information on
Microsoft, please visit the Microsoft web page at
http://www.microsoft.com/presspass on Microsoft's corporate information
pages. Web links, telephone numbers and titles were correct at time of
publication, but may since have changed. Shareholder and financial
information, as well as today's 2:30 p.m. PDT conference call with investors
and analysts, are available at http://www.microsoft.com/msft.

Kevin John Panzke

No, It Will Not End For Microsoft Just As Long As The EU Is Still In
Business, Just FYI.

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