Goldman Sachs Updates Estimates on Microsoft (MSFT) on Windows 8 Upgrade

Goldman Sachs updated estimates on Microsoft (NASDAQ: MSFT) for the Windows 8 upgrade program.

Under the program, PC purchases made between June 2, 2012 and January 31, 2013 qualify for a Windows 8 upgrade to the higher SKU Windows Pro for $15. The firm notes that for prior releases the upgrade was offered free of charge. Management guided for deferral revenues to range between $450-550mn for the June 2012 quarter.

For the June 2012 quarter Goldman is now modeling Windows revenue, EPS and deferred revenue of $4.5 bn, $0.63, $19.2 bn (GS prior: $5.0 bn, $0.68, $18.7 bn; consensus prior: $4.7 bn $0.66, $18.9 bn). For FY2013 estimates are now $22.1 bn, $3.06, $19.7 bn (GS prior: $21.6 bn, $3.01, $19.7 bn; consensus prior: $20.8 bn, $3.05, $20.8 bn). FY14 estimates are unchanged.

The firm maintained their Neutral rating and price target of $34.00.

For an analyst ratings summary and ratings history on Microsoft click here. For more ratings news on Microsoft click here.

Shares of Microsoft closed at $28.45 yesterday.

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