Microsoft Chief Financial Office Christopher Liddell today confirmed that Microsoft is on track for revenue growth of 13% to 15% for 2007. Liddell said, “Revenue growth will continue to be a strong focus for us … and we
have had two major product launches which will help. We also believe we can sell 10 million XBox Live units by the end of
the Christmas season.” He continued by explaining that “Online services is proving the most challenging from a margins point of view.” So it looks as though Microsoft is banking on Vista, Office 2007, and the Xbox 360.
Liddell was speaking at a Nasdaq analyst conference in London. He also mentioned that Microsoft will continue to invest in 2007 with a pool of $300 million set aside for acquisitions and operating costs, $1 billion for high growth products, and $500 million for online services.
Microsoft has been criticized for its inability to let go of the notion that the consumer needs software installed on the desktop while Google and friends are praised for innovation in the online sector. It seems that Microsoft is anticipating the need to move more toward the online services model, but 2007 looks to be yet another year for the company relying on its cash cows of Operating System and Office Suites.
The behemoth is most definitely in the process of switching gears. It just wants to suck the traditional model dry before officially moving on. One thing is for sure, entering the realm of gaming and entertainment was a smart move. The want (need?) for gaming and entertainment doesn’t seem to be diminishing in any way…