Place your bets on research

No reason to sugarcoat the Microsoft quarterly financial report issued this afternoon: it reflected the bad news in the overall economy.  Revenue down, earnings down, profits down. 

What I did find most interesting was the silver lining as Business Week points out in its coverage. Like most of Wall Street apparently (MSFT stock rose in after-hours trading), Business Week was impressed with some of the positive steps taken by the company:

Maybe the most striking news is Microsoft’s crisp cost-cutting. Who knew this Midas of the computer industry knew how to scale back so well? In the quarter, administrative costs fell by more than $1 billion, from $2.3 billion to $913 million. And the company completed its first ever general layoff, of 5,000 people. The company did not cut into its R&D budget, however. Spending there rose from $2 billion to $2.2 billion.”

It’s that last point that I’m focusing on, as it demonstrates that the company is living up to CEO Ballmer’s pledge to increase our annual R&D spending – amid this deep recession – from $8 billion a year to over $9 billion.

At a time when most budgets are hurting, that’s quite an investment.  If you’d like to know what we’re getting for that, check out http://research.microsoft.com, or for the most up-to-date reports, use Twitter to follow @MSFTResearch – this week, the Twitter feed has focused on papers and demonstrations we’re presenting at the 18th International World Wide Web Conference (WWW2009).

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