Microsoft has reported fourth quarter and full year results for its financial year ending June 30th 2013.

I am in the habit of tracking the results quarter by quarter with a simple table:

Quarter ending June 30th 2013 vs quarter ending June 30th 2012, $millions

What is notable in the figures? Windows profits are down, not so much due to declining PC sales but rather this:

These financial results include a $900 million charge, or a $0.07 per share impact, related to Surface RT inventory adjustments.

That said, Microsoft reports that after adjusting for deferred revenue, Windows client decreased 6% quarter on quarter and 1% for the full year, so the PC decline is having an impact.

Business, which includes Office, SharePoint and Office 365, is performing well and the company reports $1.5 billion annual revenue for Office 365.

Server and Tools (almost all Server) continues to shine:

Server & Tools revenue grew 9% for the fourth quarter and 9% for the full year, driven by double-digit percentage revenue growth in SQL Server and System Center.

Even Online, which is essentially Bing-related advertising income, is showing signs of life, despite yet another loss:

Online Services Division revenue grew 9% for the fourth quarter and 12% for the full year, driven by an increase in revenue per search and volume. Bing organic U.S. search market share was 17.9% for the month of June 2013, up 230 basis points from the prior year period.

Windows Phone is hidden in Entertainment and Devices, which reported a loss despite $1.9 billion revenue. Microsoft says:

Windows Phone revenue, reflecting patent licensing revenue and sales of Windows Phone licenses, increased $222 million.

This means that Xbox is slightly down but overall revenue slightly up thanks to Windows Phone.

Overall both revenue and profit are a little higher than the previous year.

Losing a billion dollars on Surface RT is careless. Put simply, Microsoft ordered far too many of its experimental new ARM-based version of Windows, at a time when few new-style apps were available. I do not regard this as proof that the entire concept was wrong, though it is a significant mis-step however you spin it. See further post coming shortly.