Microsoft to defer revenue from Windows upgrade offer
(Reuters) - Microsoft Corp said it will defer the $450 million to $550 million of revenue it expects to generate this quarter from an offer to upgrade to its new Windows 8 operating system.
From Saturday, Microsoft is offering customers who buy qualifying Windows 7 PCs the option to download an upgrade to Windows 8 Pro for about $14.99.
The company, whose shares were down 1.3 percent in early trading on Friday, said it would recognize the revenue from the offer when consumers actually upgrade or on February 28, when the program expires.
"From our perspective it's business as usual. This is the way they do these big launches," said Cross Research analyst Richard Williams.
Windows 8 is the new version of Microsoft's flagship product that provides almost half of its profit. It is the first version that runs on tablet computers as well as PCs, putting Microsoft in a stronger position to challenge Apple Inc.
Based on the timeline for the launch of Windows 7 three years ago, Microsoft is on track for a full release of Windows 8 by October or November, when machines running it will be available in stores.
Microsoft shares were down 37 cents at $28.82 in early trading on Friday on the Nasdaq.
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