For the fiscal year ended June 30, 2007, Microsoft announced revenue of $51.12 billion, a 15% increase over the prior year. Diluted earnings per share for the year were $1.42. Excluding certain items, earnings per share would have been $1.49, an increase of 17% over the prior year when also adjusted for certain items. $31 billion in cash, or approximately 175% of operating cash flow, was returned to shareholders during the year through share buybacks and dividends.

“Surpassing $50 billion in annual sales is a testament to the innovation and value that our product groups delivered into the marketplace, as well as the outstanding execution by our field sales, marketing teams and partners to bring that value to life with our customers,” said Kevin Turner, chief operating officer at Microsoft. “In fiscal year 2008, we will continue to drive growth through new product offerings, such as Windows Server 2008, Visual Studio 2008, SQL Server 2008, Office PerformancePoint Server 2007, and Microsoft Dynamics Live CRM.”

This fiscal year marked the general availability of Microsoft’s flagship products, Windows Vista and the 2007 Microsoft Office system. Revenue growth was primarily driven by solid customer acceptance of these products, as well as increasing sales of existing products such as SQL Server, Windows Server, Visual Studio, and Xbox 360 consoles.

“Our results this quarter cap off an extremely strong fiscal year for the company,” said Chris Liddell, chief financial officer at Microsoft. “We have healthy core businesses and are strategically investing in growth opportunities, which will build on our success and contribute to continued double-digit revenue and earnings growth in fiscal year 2008.”