IT giants rake in the cash

The IT industry's two biggest players have reported strong quarterly results, with both recording year-on-year profit rises of over 60 per cent.

Microsoft posted fourth quarter net profits of $2.2bn, up 62 per cent on the same period last year. Fourth quarter revenues stood at $5.76bn, up 39 per cent. The company's year-end results showed profits of $7.8bn, 73 per cent up on 1998. Revenues of $19.8bn showed a 30 per cent rise.

The software giant attributed the results to strong consumer demand for its Windows and Office software, but warned that weakening PC demand, Year 2000 uncertainty and an unsteady global economy will see revenue growth slow during the coming year.

Meanwhile, IBM has posted second quarter net profits of $2.4bn, up 60 per cent on the same period last year. Revenues were up 16 per cent to $21.9bn.

The results included a one-off tax benefit of $700m, resulting from the sale of IBM's Global Network and measures taken in its microelectronics and storage units.

Big Blue chief, Lou Gerstner, said the strong performance was mainly due to the firm's services and software businesses.