EXHIBIT 99.1
RECLASSIFIED HISTORICAL INCOME STATEMENTS BY YEAR
MICROSOFT CORPORATION
RECLASSIFIED INCOME STATEMENTS
(In millions) (Unaudited)
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Fiscal year Fiscal year Fiscal year to date
1997 1998 1999
Reported Reclassified Reported Reclassified Reported Reclassified
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Revenue $11,358 $11,936 $14,484 $15,262 $13,222 $13,983
Operating expenses:
Cost of revenue 1,085 2,170 1,197 2,460 1,090 2,145
Research and development 1,925 1,863 2,502 2,601 1,889 2,030
Acquired in-process
technology 0 0 296 296 0 0
Sales and marketing 2,856 2,411 3,412 2,828 2,766 2,331
General and administrative 362 362 433 433 392 392
Other expenses 259 259 230 230 60 60
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Total operating expenses 6,487 7,065 8,070 8,848 6,197 6,958
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Operating income 4,871 4,871 6,414 6,414 7,025 7,025
Investment income 443 443 703 703 1,318 1,318
Gain on sale 0 0 0 0 160 160
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Income before income taxes 5,314 5,314 7,117 7,117 8,503 8,503
Provision for income taxes 1,860 1,860 2,627 2,627 2,920 2,920
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Net income $3,454 $3,454 $4,490 $4,490 $5,583 $5,583
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Earnings per share:
Basic $ 0.72 $ 0.72 $ 0.92 $ 0.92 $ 1.11 $ 1.11
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Diluted $ 0.66 $ 0.66 $ 0.84 $ 0.84 $ 1.02 $ 1.02
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