But revenue does not equal profit. That gaming division – how profitable is it? I’m not certain about the others, but I do know that the vast majority of Microsoft’s profits derive from Office and Windows.

The reality is, and will continue to be for some time, that MS is huge, makes a ton of money, and is a major force in technology.

But I don’t think anyone in technology would argue that they hold anything like the power position they did 5 or 10 years ago.

And while one down quarter doesn’t mean everything, it does mean something.

Well, that depends on how you define “hit anything out of the park” and “big core franchises.”

According to Robert Scoble not too long ago, Microsoft has 14 businesses that make a billion-dollars or more a year in revenue.
These include an email server, a database server, developer tools, a game console, a document server, office productivty applications, a desktop client operating system, a server operating system, CRM software, and others.

Or maybe you define “hit it out of the park” by the number of users? Microsoft has a consumer email product with 400 million users, and an instant messaging product with 300 million users (“MSN” is a verb in some countries, meaning to instant-message someone). It has a sold more than 25 million game consoles (not counting the original XBox). Halo 3 sold enough product in a single day to beat the opening weekend of any movie every made.

Ultimately, this a company that, in the midst of a massive economic recession, pulled in $58 *billion* in revenue this year. That’s down from over $60 billion last year, but is still greater than the GDP of all but the top 65 countries in the world, and greater than the entire national annual budget of countries like New Zealand.

Half of that was due to the “traditional” franchises of Windows and Office, but there rest…

Anyway, you’re entitled to your opinion.

Not true. MS is also making piles of money from their development tools (SQL, Visual Studio, Exchange Server, etc).