By Nathalie Tadena Microsoft Corp. (MSFT) swung to a fiscal fourth-quarter loss as the software giant booked a hefty write-down in its online services division and deferred revenue related to its Windows 8 upgrade promotion. Microsoft's continued strength in sales of its Office suite of products to corporate customers has helped cushion the company from the impact of slumping personal computer sales. The company earlier this week gave a preview of its new Office software that embraces cloud computing and mobile devices in an effort to revitalize its core software offering for global business. Microsoft needs demand for Office to remain robust as it transitions customers to cloud services and its forthcoming Windows 8 operating system that will run on both traditional PCs and tablet computers. Windows is the software powering most of the world's PCs. Windows 8 is widely seen as Microsoft's best chance at competing with machines running Google Inc.'s (GOOG) Android operating system and Apple Inc.'s (AAPL) iPad. It will go on sale Oct. 26. To sustain sales of its Windows 7 operating system through October, the company has said buyers of selected versions of Windows 7 through the end of January 2013 will be able to upgrade to a version of Windows 8 Pro at a discount. For the quarter ended June 30, Microsoft reported a loss of $492 million, or six cents a share, compared with a year-earlier profit of $5.87 billion, or 69 cents a share. The latest period's results included a $6.19 billion goodwill write-down in its online services division, connected to its 2007 acquisition of online-advertising agency aQuantive Inc. for $6.3 billion. It also included the deferral of $540 million of revenue related to the Windows Upgrade Offer. Excluding the impairment and deferred revenue, adjusted earnings were 73 cents a share. Revenue increased 4% to $18.06 billion. Analysts polled by Thomson Reuters most recently projected earnings of 62 cents a share and revenue of $18.13 billion. Total operating expenses were up 60%. Microsoft's Windows and Windows Live Division saw revenue decrease 13%, including the impact of the deferred revenue, as profit fell 18%. Revenue for the company's servers and tools products, which form the backbone of enterprise networks and private clouds, jumped 13% while the segment's profit improved 24%. At the business division, which earns most of its sales from Microsoft Office, sales were up 7.1.% as profit advanced 9%. Recent quarters have seen strong demand for the company's cloud-based Office 365 suite of office utilities and collaboration tools. Sales at the entertainment-and-devices business, which houses the Xbox video game console, jumped 20%. In online services, revenue was up 8.1%. Microsoft has invested heavily in the unit, launching a splashy advertising blitz last year to promote Bing, which is the second-most-popular search engine in the U.S. behind Google, according to comScore Inc. (SCOR). Microsoft shares were up 1.9% to $31.24 after hours. Through the close, Microsoft's stock is up 18% since the start of the year. -Write to Nathalie Tadena at nathalie.tadena@dowjones.com Subscribe to WSJ: http://online.wsj.com?mod=djnwires
