Reuters: Technology News: Microsoft takes $6.2 billion charge, slows Internet hopes

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Microsoft takes $6.2 billion charge, slows Internet hopes Jul 2nd 2012, 21:17 Tweet Share this Email Print Related News Google offers to settle EU antitrust probe 1:46pm EDT RIM prospects dire after launch delay: analysts Fri, Jun 29 2012 Microsoft tackles iPad with Surface tablet Tue, Jun 19 2012 Insight: Google goes softly-softly on European antitrust Mon, Jun 11 2012 Google keeps EU regulator waiting on concessions Thu, Jun 7 2012 Analysis & Opinion The great newspaper liquidation A photo illustration shows the websites of search engines Baidu and Bing on computer screens in Shanghai July 5, 2011. Credit: Reuters/Carlos Barria Mon Jul 2, 2012 5:17pm EDT (Reuters) - Microsoft Corp ratcheted back growth expectations for its Internet and search engine unit on Monday as it took a $6.2 billion write-down on the value of an online advertising company it bought five years ago. The charge will likely wipe out any profit for the company's fiscal fourth quarter, the results of which are expected later this month. Microsoft bought Internet advertising company aQuantive in 2007 in an attempt to catch rival Google Inc in the race for revenues from search-related advertising. The $6.3 billion deal was Microsoft's biggest at the time, but it never proved a success. As a result of its annual assessment of goodwill - the amount paid for a company above its net assets - Microsoft said it would take a non-cash charge of $6.2 billion, effectively indicating that the aQuantive acquisition is now worthless. "The acquisition did not accelerate growth to the degree anticipated, contributing to the write-down," Microsoft said in a statement. In addition to the write-down, Microsoft said that its expectations for future growth and profitability at its online services unit, which includes the Bing search engine and MSN Internet portal, are "lower than previous estimates". The company did not immediately clarify what those previous estimates were, as it does not publish financial forecasts. (Reporting by Siddharth Cavale in Bangalore, Bill Rigby in Seattle; Editing by Supriya Kurane, Bernard Orr) Related Quotes and News Company Price Related News Tweet this Link this Share this Digg this Email Reprints We welcome comments that advance the story through relevant opinion, anecdotes, links and data. If you see a comment that you believe is irrelevant or inappropriate, you can flag it to our editors by using the report abuse links. Views expressed in the comments do not represent those of Reuters. For more information on our comment policy, see http://blogs.reuters.com/fulldisclosure/2010/09/27/toward-a-more-thoughtful-conversation-on-stories/ Comments (0) Be the first to comment on reuters.com. Add yours using the box above.

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