Microsoft Corporation General Company Information Address One Microsoft Way Redmond, WA 98052-6399 United States Phone: 425 882-8080 Fax: 425 936-7329 Country United States Ticker MSFT Date of Incorporation June 1981 , WA, United States Number of Employees 89,000 (Approximate Full-Time as of 06/30/2010) Number of Shareholders 138,568 (record) (as of 07/20/2010) Company Website www.microsoft.com Annual Meeting Date In November Mergent Dividend Achiever No Closing Price As of 02/18/2011 : 27.06

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Microsoft Corporation

Business Description Industry Internet & Software NAICS Primary NAICS: 511210 - Software Publishers Secondary NAICS: 334119 - Other Computer Peripheral Equipment Manufacturing 423430 - Computer and Computer Peripheral Equipment and Software Merchant Wholesalers 541519 - Other Computer Related Services SIC Primary SIC: 7372 - Prepackaged software Secondary SIC: 3577 - Computer peripheral equipment, nec 7379 - Computer related services, nec Business Description Microsoft is engaged in developing, manufacturing, licensing, and supporting a range of software products and services for several computing devices. Co.'s software products and services include operating systems for personal computers, servers, and intelligent devices; server applications for distributed computing environments; information worker productivity applications; business and computing applications; software development tools; and video games. Co. also provides consulting and product and application support services, as well as trains and certifies computer system integrators and developers. In addition, Co. designs and sells hardware including the Xbox 360 gaming and entertainment console and accessories, the Zune digital music and entertainment device and accessories, and Microsoft personal computer (PC) hardware products. Co. operates through five segments. The Windows & Windows Live segment offerings consist of Windows operating systems, including Windows 7, and online software and services through Windows Live. Windows Live primarily generates revenue from online advertising. The Server and Tools segment provides product and service such as Windows Server, Microsoft SQL Server, Windows Azure and other cloud and server offerings. The Server and Tools segment also provides Enterprise Services, which comprise Premier product support services and Microsoft Consulting Services. The Online Services segment consists of an online advertising platform with offerings for both publishers and advertisers, online information offerings, such as Bing, and the MSN portals and channels around the world. The Microsoft Business segment provides offerings such as Microsoft Office, SharePoint, and Microsoft Dynamics business applications. The Entertainment and Devices Division segment provides applications such as the Xbox 360 platform, the Zune digital music and entertainment platform, PC software games, online games and services, Mediaroom (Co.'s Internet protocol television software), Windows Phone, Windows Embedded device platforms, application software for Apple's Macintosh computers, and Microsoft PC hardware products.

Geographic Analysis

Revenues Report Date

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06/30/2010

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Microsoft Corporation Report Date Currency Scale United States Other Countries Total

06/30/2010 USD Thousands 36,173,000 26,311,000 62,484,000

Report Date Currency Scale United States Other Countries Total

06/30/2009 USD Thousands 33,052,000 25,385,000 58,437,000

Report Date Currency Scale United States Other Countries Total

06/30/2008 USD Thousands 35,928,000 24,492,000 60,420,000

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Microsoft Corporation

Business Summary Microsoft develops, manufactures, licenses, and supports software products and services for computing devices. Co.'s software products and services include operating systems for personal computers, servers, and intelligent devices; server applications; information worker productivity applications; business applications; computing applications; and video games. In addition, Co. provides consulting and support services, and trains and certifies computer system integrators and developers, as well as designs and sells hardware. Co.'s five segments are: Windows & Windows Live Division; Server and Tools; Online Services Division; Microsoft Business Division; and Entertainment and Devices Division.

Executives Top 5 Executives Officers William H. Gates Title : Chairman Compensation History Year Salary Bonus Other Annual Compensation/Fees Stock Awards All Other Compensation Total Compensation

Values in USD 2006 616,667 350,000 N/A N/A 2,112 968,779

2005 600,000 400,000 N/A N/A 2,469 1,002,469

2004 591,667 310,000 N/A N/A 2,787 904,454

Summary Biography William H. Gates, III, a Co-founder of Microsoft Corporation, has served as Chairman since its incorporation in 1981. Mr. Gates retired as an employee effective July 1, 2008, but continues to serve as Microsoft's Chairman, and serve as an Advisor on key development projects. Mr. Gates served as Chief Software Architect from January 2000 until June 2006, when he announced a two-year plan for his transition out of a day-to-day role. Mr. Gates served as Chief Executive Officer of Microsoft Corporation from 1981 until January 2000, when he resigned as Chief Executive Officer and assumed the position of Chief Software Architect. Mr. Gates is also a Director of Berkshire Hathaway Inc. He is a former Director of ICOS Corporation. His work overseeing the Bill and Melinda Gates Foundation provides ongoing global insights relevant to Microsoft¿s current and future business opportunities.

Steven A. Ballmer Title : Chief Executive Officer Compensation History Year Salary Bonus All Other Compensation Total Compensation

Values in USD 2010 670,000 670,000 11,121 1,351,121

2009 665,833 600,000 10,794 1,276,627

2008 640,833 700,000 10,001 1,350,834

Summary Biography Steven A. Ballmer, was appointed Chief Executive Officer of Microsoft Corporation in January 2000, assuming full management responsibility for Microsoft Corporation, and has been a Director since 2000. Mr. Ballmer joined Microsoft in 1980 and was the first Business Manager hired by Mr. Gates. During the past 20 years, Mr. Ballmer has headed several 02/20/2011

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Microsoft Corporation Microsoft divisions, including operations, operating systems development, and sales and support. He served as President from July 1998 to February 2001. Previously, he had served as Executive Vice President, Sales and Support since February 1992. Mr. Ballmer graduated from Harvard University with a Bachelor's degree in Mathematics and Economics. After college, he worked for two years at Procter & Gamble Co. as an Assistant Product Manager and, before joining Microsoft, attended Stanford University Graduate School of Business.

Lisa E. Brummel Title : Senior Vice President Summary Biography Lisa E. Brummel, was named Senior Vice President, Human Resources of Microsoft Corporation in December 2005. She had been Corporate Vice President, Human Resources of Microsoft since May 2005. From May 2000 to May 2005, she had been Corporate Vice President of the Home & Retail Division of Microsoft. Since joining Microsoft in 1989, Ms. Brummel has held a number of management positions at Microsoft, including General Manager of Consumer Productivity business, Product Unit Manager of the Kids Business, and Product Unit Manager of Desktop and Decision reference products. Before joining Microsoft in 1989, Ms. Brummel held various sales management and marketing positions with Prentice Hall Inc. publishing company. Ms. Brummel holds a Master's degree in Business Administration from the University of California, Los Angeles, and a Bachelor of Arts degree in Sociology from Yale University. She is active in charitable ventures associated with Hopelink community services, the University of Washington Medical Center, Yale University, the Human Rights Campaign and the Women's Funding Alliance.

Richard F. Rashid Title : Senior Vice President Summary Biography Dr. Richard (Rick) Rashid, Ph.D., has served as Senior Vice President, Research of Microsoft Corporation since 2000. Dr. Rashid oversees worldwide operations for Microsoft Research. After joining Microsoft in September 1991, Dr. Rashid served as Director and Vice President of the Microsoft Research division and was promoted to his current role in 2000. Before joining Microsoft, Dr. Rashid was a Professor of Computer Science at Carnegie Mellon University (CMU). Dr. Rashid's research interests have focused on artificial intelligence, operating systems, networking and multiprocessors. He has participated in the design and implementation of the University of Rochester's Rochester Intelligent Gateway operating system, the Rochester Virtual Terminal Management System, the CMU Distributed Sensor Network Testbed, and CMU's SPICE distributed personal computing environment. He also co-developed of one of the earliest networked computer games, "Alto Trek," during the mid-1970s. Dr. Rashid is a Member of the National Science Foundation Computer Directorate Advisory Committee and a past Member of the Defense Advanced Research Projects Agency UNIX Steering Committee and the Computer Science Network Executive Committee. He is also a former Chairman of the Association for Computing Machinery Software System Awards Committee. Dr. Rashid received a Master of Science (1977) and Doctoral (1980) degrees in Computer Science from the University of Rochester. He graduated with honors in Mathematics and Comparative Literature from Stanford University in 1974.

Eric D. Rudder Title : Senior Vice President Summary Biography Eric D. Rudder, has served as Senior Vice President, Technical Strategy of Microsoft Corporation, since September 2005. Mr. Rudder focuses on some of Microsoft 's key advanced development efforts as well as overall technical strategy. Mr. Rudder most recently served since June 2003, as Senior Vice President of Servers and Tools, and was also responsible for leading the company's outreach to the developer community. Prior to leading the Developer and Platform Evangelism Division, he was Vice President of Technical Strategy working directly with Chairman and Chief Software Architect Bill Gates on Microsoft's 02/20/2011

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Microsoft Corporation technical planning processes. He also has worked in several other areas at Microsoft, including networking, operating systems and developer tools, where he previously served as General Manager for Visual Studio. Mr. Rudder joined Microsoft Corporation in 1988. Mr. Rudder graduated with honors from Brown University in 1988.

Directors William H. Gates Title : Chairman Compensation History Year Salary Bonus Other Annual Compensation/Fees Stock Awards All Other Compensation Total Compensation

Values in USD 2006 616,667 350,000 N/A N/A 2,112 968,779

2005 600,000 400,000 N/A N/A 2,469 1,002,469

2004 591,667 310,000 N/A N/A 2,787 904,454

Summary Biography William H. Gates, III, a Co-founder of Microsoft Corporation, has served as Chairman since its incorporation in 1981. Mr. Gates retired as an employee effective July 1, 2008, but continues to serve as Microsoft's Chairman, and serve as an Advisor on key development projects. Mr. Gates served as Chief Software Architect from January 2000 until June 2006, when he announced a two-year plan for his transition out of a day-to-day role. Mr. Gates served as Chief Executive Officer of Microsoft Corporation from 1981 until January 2000, when he resigned as Chief Executive Officer and assumed the position of Chief Software Architect. Mr. Gates is also a Director of Berkshire Hathaway Inc. He is a former Director of ICOS Corporation. His work overseeing the Bill and Melinda Gates Foundation provides ongoing global insights relevant to Microsoft¿s current and future business opportunities.

Raymond V. Gilmartin Title : Lead Director Compensation History Year Other Annual Compensation/Fees Stock Awards Total Compensation

Values in USD 2010 90,000 120,000 210,000

2009 90,015 120,005 210,020

2008 45,000 60,000 105,000

Summary Biography Raymond V. Gilmartin, has been a Professor of Management Practice at the Harvard Business School since July 2006, teaching in the MBA program. Mr. Gilmartin has been a Director of Microsoft Corporation since April 2001, and serves as its Lead Independent Director. He has been a Director of General Mills, Inc. since 1997. He is the former Chairman, President and Chief Executive Officer of Merck & Company, Inc., a pharmaceutical company, and served in that capacity from 1994 to May 2005. He served as Special Advisor to the Executive Committee of the Board of Merck from 2005 to April 2006. He previously served as Chairman, President and Chief Executive Officer of Becton Dickinson and Company, a medical technology company. Mr. Gilmartin received a B.S. in Electrical Engineering from Union College in 1963 and an M.B.A. from Harvard Business School in 1968.

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Microsoft Corporation Steven A. Ballmer Compensation History Year Salary Bonus All Other Compensation Total Compensation

Values in USD 2010 670,000 670,000 11,121 1,351,121

2009 665,833 600,000 10,794 1,276,627

2008 640,833 700,000 10,001 1,350,834

Summary Biography Steven A. Ballmer, was appointed Chief Executive Officer of Microsoft Corporation in January 2000, assuming full management responsibility for Microsoft Corporation, and has been a Director since 2000. Mr. Ballmer joined Microsoft in 1980 and was the first Business Manager hired by Mr. Gates. During the past 20 years, Mr. Ballmer has headed several Microsoft divisions, including operations, operating systems development, and sales and support. He served as President from July 1998 to February 2001. Previously, he had served as Executive Vice President, Sales and Support since February 1992. Mr. Ballmer graduated from Harvard University with a Bachelor's degree in Mathematics and Economics. After college, he worked for two years at Procter & Gamble Co. as an Assistant Product Manager and, before joining Microsoft, attended Stanford University Graduate School of Business.

Dina Dublon Compensation History Year Other Annual Compensation/Fees Stock Awards Total Compensation

Values in USD 2010 100,000 120,000 220,000

2009 100,000 120,000 220,000

2008 50,000 60,000 110,000

Summary Biography Dina Dublon, has been a Director of Microsoft Corporation since March 22, 2005. Ms. Dublon served as Executive Vice President and Chief Financial Officer of JPMorgan Chase from December 1998 until her retirement in September 2004. Ms. Dublon was responsible for the global financial management and reporting, related technology and operations, strategy and acquisitions, corporate treasury, investor relations and tax. She was involved in the negotiation and implementation of the mergers of Chemical Bank with Manufacturers Hanover, Chase, JPMorgan, and Bank One. Ms. Dublon joined Chemical Bank's capital markets group as a trainee on the trading floor in 1981. From 1981 to 1996, Ms. Dublon held positions in capital markets, asset liability management and investment banking. She became Corporate Treasurer in 1994 and Head of Corporate Planning in 1996. Prior to joining Chemical Bank, Ms. Dublon worked as a Research Associate for the Harvard Business School and as Regional Director, Securities Division at Bank Hapoalim in Israel. Ms. Dublon also serves on the board of directors of Accenture, Ltd., and PepsiCo, Inc. She is a Founding Board Member of Greenstone Media, and serves on the boards of Carnegie Mellon University, the Global Fund for Women and The Women's Commission for Refugee Women & Children. Ms. Dublon, born in Brazil, holds a Bachelor of Arts degree in Economics and Mathematics from the Hebrew University in Jerusalem and a Master of Science degree from the Business School at Carnegie Mellon University.

Reed Hastings Compensation History Year

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Values in USD 2010

7

2007

2009

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Microsoft Corporation Year Other Annual Compensation/Fees Stock Awards Total Compensation

Values in USD 2010 80,000 120,000 200,000

2007 60,000 90,000 150,000

2009 N/A 200,000 200,000

Summary Biography Reed Hastings, has been a Director of Microsoft Corporation since March 26, 2007. Mr. Hastings founded Netflix, Inc. in 1997, and has served as Chairman of Netflix from its inception. Mr. Hastings became Chief Executive Officer of Netflix in September 1998. Prior to joining Netflix, Mr. Hastings served as Founder, Chief Executive Officer, and Chairman of Pure Atria Software, a maker of software development tools, from October 1991, until it was acquired by Rational Software Corporation in August 1997. He holds several patents in the areas of data processing and software development. Mr. Hastings is an active educational philanthropist and board member of various charitable organizations. Mr. Hastings received a B.A. from Bowdoin College in 1983, and an MSCS degree from Stanford University in 1988. Between Bowdoin and Stanford, Mr. Hastings served in the U.S. Peace Corps as a High School Math Teacher in Swaziland.

History Incorporated in Washington in June 1981 as a successor to a partnership formed in 1975. In Aug. 1987, Co. acquired Forethought Inc. In May 1989, Co. acquired a minority interest in The Santa Cruz Operation, Inc. for $19,900,000. In Sept. 1990, Co. formed Information Technology Integration Services. In Mar. 1991, Co. acquired a 26% strategic share of Dorling Kindersley Ltd. As part of the agreement, the Microsoft Multimedia Publishing Group gains rights to license content from Dorling Kindersley book titles for use in future Microsoft multimedia software titles. In June 1992, Co. merged with Fox Software Inc. of Perryburg, Ohio. Co. exchanged 2,000,000 shares for all outstanding stock of Fox. In Dec. 1992, Co. opened Microsoft Czecho-Slovakia, a wholly-owned subsidiary in Eastern Europe. In Jan. 1993, Co. opened a new wholly owned subsidiary, Microsoft A.O., in Moscow. In May 1994, Co. acquired SOFTIMAGE Inc. for approx. $130,000,000. In Nov. 1994, Co. acquired One Tree Software (Raleigh, NC). In Jan. 1995, TCI Technology Ventures (TCI) a wholly-owned subsidiary of Tele-Communications, Inc. made a minority investment in the newly formed Microsoft Online Services Partnership (now The Microsoft Network LLC) which operates Co.'s online service, The Microsoft Network. TCI Technology Ventures invested $125,000,000 and acquired a 20% interest in MOSP. Co., the managing partner, holds 80% of MOSP. In Feb. 1995, Co. acquired RenderMorphics Ltd. (London). On July 10, 1995, Co. acquired intellectual-property rights of Network Managers (U.K.) Ltd. On Nov. 6, 1995, Co. acquired the assets and expertise of Netwise Inc.

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Microsoft Corporation In Dec. 1995, Co. acquired the Bruce Artwick Organization Ltd. During 1996, Co. and National Broadcasting Company (NBC) established two MSNBC joint ventures: a 24-hour cable news and information channel and an interactive online news service. Co. agreed to pay $220 million over a five-year period for its interest in the cable venture, to pay one-half of operational funding of both joint ventures for a multiyear period, and to guarantee a portion of MSNBC debt. In Dec. 1999, Co. and and Global Crossing Ltd formed a joint venture to build a high capacity telecommunications network in Asia. The venture is called Asia Global Crossing. Global Crossing owns 93% of Asia Global Crossing. The company contributed its 58% stake in Pacific Crossing along with development rights to another network called East Asia Crossing. Global Crossing also plans to integrate its 50% share of Hutchison Global Crossing, a joint venture with Hong Kong's Hutchison Whampoa Ltd. Co. and Softbank contributed $175 million each for 3.5% stakes in Asia Global Crossing.In May 2000, Xerox Corporation and Microsoft Co. created a new company, ContentGuard Inc. Xerox will retain majority stake in ContentGuard Inc, formerly the Xerox Rights Management group. In Jan. 1996, Co. acquired Vermeer Technologies Inc. On Mar. 3, 1997, Co. acquired Interse Corp. Financial terms were not disclosed. On June 10, 1997, Co. purchased 11.5% of Comcast Corp. for $1,000,000,000. On June 16, 1997, Co. acquired Cooper & Peters Inc. Financial terms weren't disclosed. On Aug.1, 1997, Co. acquired WebTV Networks, Inc. (WebTV) for $425,000,000 in stock and cash. In Apr. 1998, Co. acquired The Mesa Group Inc. Details were not disclosed. In Aug. 1998, Co. acquired Valence Research Incorporated. In Aug. 1998, Co. sold a wholly-owned subsidiary, Softimage Inc. to Avid Technology, Inc. for $79,000,000 in cash and securities valued at $85,000,000. In Nov. 1998, Co. acquired LinkExchange, Inc. for $265,000,000 in stock. In Mar. 1999, Co. acquired CompareNet Inc. Financial terms of the transaction were not disclosed. In Mar. 1999, Co. acquired Numinous Technologies Inc. for an undisclosed sum. In May 1999, Co. purchased a 4.25% stake in Nextel Communications Inc. for $600,000,000. In June 1999, Co. acquired ShadowFactor Software Inc. In June 1999, Co. and Dell Computer Corp bought minority stakes in NaviSite Inc. Co. acquired a 4.4% stake in NaviSite. Terms were not available. In July 1999, Co. acquired Zoomit Corp. In July 1999, Co. acquired STNC Ltd. In Sept. 1999, Co. acquired portions of Photo Access Corp.'s digital imaging intellectual property, as part of Co.'s development efforts in digital imaging. Terms of the agreement were not disclosed. In Sept. 1999, Co.'s entertainment guide portion of MSN Sidewalk was acquired by Ticketmaster Online CitySearch. Under the terms, Co. will take an initial 9% stake in TMCS that could go as high as 13% with warrant exercise. 02/20/2011

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Microsoft Corporation In Nov. 1999, Co. acquired Entropic Inc. In Dec. 1999, Co. and Global Crossing Ltd. formed a joint venture to build a high capacity telecommunications network in Asia. The venture is called Asia Global Crossing. Global Crossing owns 93% of Asia Global Crossing. The company contributed its 58% stake in Pacific Crossing along with development rights to another network called East Asia Crossing. Global Crossing also plans to integrate its 50% share of Hutchison Global Crossing, a joint venture with Hong Kong's Hutchison Whampoa Ltd. Co. and Softbank contributed $175 million each for 3.5% stakes in Asia Global Crossing. On Jan. 10, 2000, Co. acquired Visio Corp. for approx. $1,500,000,000 in stock. Under terms of the acquisition Visio became Visio Division operating within Co.'s Business Productivity Group. On Feb. 24, 2000, Co. sold its joint venture with DreamWorks SKG, DreamWorks Interactive, LLC, to Electronic Arts, Inc. Financial terms were not disclosed. In Apr. 2000, Co. acquired MediaOne International's stake in TITUS Communications. Terms of the acquisition were not disclosed. In May 2000, Xerox Corporation and Microsoft Co. created a new company, ContentGuard Inc. Xerox will retain majority stake in ContentGuard Inc, formerly the Xerox Rights Management group. In June 2000, Co. acquired Bungie Software Corp. Take Two Interactive Software Inc. acquired all right, title and interest to select Bungie game properties, and sold its 19.9% equity interest in Bungie to Co. On June 2, 2000, Co. acquired all of the assets of NetGames USA, Inc. for an aggregate of 37,530 of Co.'s common shares. In July 2000, Co. acquired a 22.98% shareholding in Telewest Communications plc for approx. $2,600,000,000 in stock. On Sept. 12, 2000, Co. issued an aggregate of 753,660 of its common shares pursuant to the acquisition by Co. of MongoMusic, Inc. On Oct. 26, 2000, Co. issued an aggregate of 137,062 of its common shares pursuant to the acquisition by Co. of WebAppoint.com, Inc. On Apr. 5, 2001, Co. acquired Great Plains Software, Inc. (Great Plains) for approx. $1,100,000,000 in stock. Under the terms of the acquisition, Great Plains became a division of Co.'s Product and Business Services Group. On Apr. 11, 2001, Co. closed the acquisition of substantially all of the assets of iCommunicate Holding, Inc., a Delaware corporation. Promptly thereafter, Co. issued an aggregate of 272,093 of its common shares to iCommunicate, which were subsequently distributed to iCommunicate's eleven shareholders in the liquidation of iCommunicate. On Nov. 5, 2001, Co. sold its interest in Wireless Knowledge Inc. (Wireless) to Wireless. On Feb. 4, 2002, Co. sold its interest in Expedia, Inc. to USA Networks, Inc. On July 11, 2002, Co. acquired Navision Software A/S (Navision). Co. purchased Navision's shares for approx. $1,450,000,000 (U.S.)/1,480,000,000 euros/10,970,000,000 Danish krones in stock and cash. On Sept. 24, 2002, Co. acquired U.K.-based Rare Ltd. under a $375 million cash transaction. On Dec. 12, 2002, Co. acquired Vicinity Corp, a provider of location-based technology and solutions, in a cash merger valued at approx. $96,000,000. Under the terms of the acquisition, Vicinity's business will be merged with Microsoft¿ MapPoint¿ Business Unit. As a result of the merger, Vicinity shareholders received $3.33 in cash in exchange for each share of Vicinity 02/20/2011

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Microsoft Corporation common stock they hold. On Feb. 19, 2003, Co. acquired the Virtual Machine Business of Connectix Corp. On Apr. 30, 2003, Co. acquired PlaceWare, Inc., a provider of Web conferencing services. On Dec. 16, 2004, Co. acquired GIANT Company Software Inc. Terms of the acquisition were not announced. On Nov. 2, 2005, Co. acquired media-streams.com AG, a software company based in Zurich, Switzerland. On Mar. 10, 2005, Co. acquired Groove Networks, Inc. Financial terms of the acquisition were not disclosed. On Mar. 15, 2005, Co., Time Warner Inc. and Thomson completed their three-way acquisition of ContentGuard, Inc. Each will hold an equal 33% voting positions in ContentGuard. On June 21, 2005, Co. acquired Sybari Software Inc. On July 11, 2005, Co. acquired 28% of Lang Chao International Ltd. for $25,000,000. On Aug. 30, 2005, Co. acquired Teleo Inc. On Aug. 31, 2005, Co. completed the acquisition of FrontBridge Technologies Inc. On Sept. 19, 2005, Co. acquired Alacris Inc. On Sept. 27, 2005, Co. acquired Chinasoft International Ltd. for $20,000,000 in cash. On Nov. 3, 2005, Co. acquired FolderShare. Financial details of the acquisition were not disclosed. On Nov. 3, 2005, Co. acquired Iomega Corp.'s ownership stake in ByteTaxi. Terms were not disclosed. On Feb. 13, 2006, Co. announced the acquisition of MotionBridge. On Mar. 7, 2006, Co. acquired the assets of Onfolio Inc., and Apptimum Inc. On Apr. 6, 2006, Co., through its subsidiary, Microsoft Game Studios (MGS), purchased U.K.-based Lionhead Studios. On May 23, 2006, CDC Software, a wholly owned subsidiary of CDC Corp., announced a strategic alliance with Co. to develop, market and deliver CRM enterprise applications to customers in the People's Republic of China. On May 23, 2006, Co. and Alcatel announced the establishment of a global relationship with HP focused on the delivery of server solutions for carrier-class triple play/Internet Protocol Television deployments. On July 11, 2006, Co. announced the launch of Windows Small Business Server 2003 R2 and unveiled new pricing details for the product. On July 17, 2006, Co. has completed the acquisition of Softricity Inc., a leading provider of application virtualization and dynamic streaming technologies. On July 18, 2006, Co. nced the availability of Microsoft(R) Solution for Windows(R)-based Hosting Version 4.0, which helps Web hosting providers rapidly launch new services; target developers of Web applications; and increase operational efficiency in their business through best practices, tools, scripts and code samples. 02/20/2011

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Microsoft Corporation On July 18, 2006, Co. acquired Winternals Software LP On Aug. 23, 2006, Co. and Citrix Systems, Inc. announced they plan to expand their existing partnership in access and end-to-end application delivery to make computing faster, more secure and more cost-effective for employees in branch office locations. On Oct. 11, 2006, Co. acquired privately owned Colloquis Inc., a provider of conversational online business solutions that feature natural language-processing technology. On Oct. 12, 2006, Co. acquired Colloquis Inc. On Nov. 7, 2006, Co. announced the Microsoft® SaaS On-Ramp Program, which provides independent software vendors (ISVs) with discounted software infrastructure and technical resources to help develop and deploy software as a service (SaaS) applications. On Dec. 12, 2006, Co. opened a private beta of its new enterprise voice communications server, Microsoft(R) Office Communications Server 2007, to 2,500 IT professionals. On Feb. 13, 2007, Co. announced the availability of the software development kit (SDK) for the Microsoft(R) .NET Micro Framework. On Mar. 6, 2007, Co. announced that Microsoft(R) Forecaster 7.0, the latest release of the company's budgeting and planning software, will be released to manufacturing on March 28, 2007. On Apr. 11, 2007, Co. and Education Networking Information Sharing and Analysis Center (REN-ISAC) formed new alliance to enhance network security information sharing with higher education institutions. On May 3, 2007, Co. completed its acquisition of Tellme Networks Inc. On June 25 2007, Co. teamed up with MasterCard Worldwide, Fedex Corporate Services and Bank of America Corp. to deliver comprehensive online resource for startup business. In Aug. 2007, Co. acquired aQuantive, Inc., a digital marketing company, for approximately $6,000,000,000 in cash. On Aug. 13, 2007, Co. acquired aQuantive Inc. for $5,373,600 in cash. On Sept. 12, 2007, Co. and Sun Microsystems had expand its strategic alliance for further enable deployment of Windows Server on Sun X64 systems. On Apr. 15, 2008, Co. acquired Danger, Inc. Terms of the transaction were not disclosed. On Apr. 25, 2008, Co. acquired Fast Search & Transfer ASA for $1,192,300 in cash. On June 18, 2008, Co. acquired Navic Networks. Terms of the transaction were not disclosed. On Oct. 14, 2008, Co. acquired Greenfield Online, Inc. for $460,900,000 in cash. On May 7, 2009, Co. acquired BigPark Inc. Terms of the transaction were not disclosed.

Institutional Holdings

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Microsoft Corporation Total Institutions: Total Shares Held: % of Shares Held:

2,149 (UP) 1 5,724,361,272 58.41%

New/Increased vs Old/Decreased Positions: Amount of Shares Held: % of shares held change:

(DOWN) -157 -194,603,981 0.01%

Changes In:

58.41% Held By Institutions

0.01% Shares Held Change

New Positions Institutions: 38 Shares: 53,965,034 % Change: 0.04%

Increased Positions Institutions: 924 Shares: 2,722,254,612 % Change: 0.00%

Closed Positions Institutions: 86 Shares: 81,575,750 % Change: 0.00%

Decreased Positions Institutions: 1,033 Shares: 2,889,247,877 % Change: 0.00%

Unchanged Positions Institutions: 154 Shares: 58,893,749 % Change: 0.00%

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Microsoft Corporation Institutional Ownership Summary for each of the top 5-10 Institutional Holders

RENAISSANCE INVESTMENT GROUP LLC Total Shares Owned by Institution 22,566 Percentage of Shares Outstanding N/A Number of Institutions 85 Shares Purchased by Institution in the Last 3 Months 0 Shares Sold by Institution in the Last 3 Months 0 3 Months Net Transactions (Purchases-Sales) N/A Quarterly Stock Price Range N/A Buyers/Sellers Summary Number of Inside Buyers Number of Inside Sellers

3 Months 6 Months 0 0 0 0

CAPITAL RESEARCH GLOBAL INVESTORS Total Shares Owned by Institution 318,145,198 Percentage of Shares Outstanding N/A Number of Institutions 419 Shares Purchased by Institution in the Last 3 Months 0 Shares Sold by Institution in the Last 3 Months 0 3 Months Net Transactions (Purchases-Sales) N/A Quarterly Stock Price Range N/A Buyers/Sellers Summary Number of Inside Buyers Number of Inside Sellers

3 Months 6 Months 0 0 0 0

VANGUARD GROUP INC Total Shares Owned by Institution 291,767,905 Percentage of Shares Outstanding N/A Number of Institutions 3420

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Microsoft Corporation Shares Purchased by Institution in the Last 3 Months 0 Shares Sold by Institution in the Last 3 Months 0 3 Months Net Transactions (Purchases-Sales) N/A Quarterly Stock Price Range N/A Buyers/Sellers Summary Number of Inside Buyers Number of Inside Sellers

3 Months 6 Months 0 0 0 0

STATE STREET CORP Total Shares Owned by Institution 274,374,928 Percentage of Shares Outstanding 99.05% Number of Institutions 3226 Shares Purchased by Institution in the Last 3 Months 0 Shares Sold by Institution in the Last 3 Months 0 3 Months Net Transactions (Purchases-Sales) N/A Quarterly Stock Price Range Time Period Low High Q1 of 2011 45.70 50.06 Q4 of 2010 37.54 47.77 Q3 of 2010 32.81 40.11 Q2 of 2010 33.82 48.07 Q1 of 2010 42.67 46.78

Buyers/Sellers Summary Number of Inside Buyers Number of Inside Sellers

3 Months 6 Months 0 0 0 0

BARCLAYS GLOBAL INVESTORS NA /CA/ Total Shares Owned by Institution 205,908,848 Percentage of Shares Outstanding N/A Number of Institutions 3556 Shares Purchased by Institution in the Last 3 Months 0

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Microsoft Corporation Shares Sold by Institution in the Last 3 Months 0 3 Months Net Transactions (Purchases-Sales) N/A Quarterly Stock Price Range N/A Buyers/Sellers Summary Number of Inside Buyers Number of Inside Sellers

3 Months 6 Months 0 0 0 0

CAPITAL WORLD INVESTORS Total Shares Owned by Institution 175,317,600 Percentage of Shares Outstanding N/A Number of Institutions 429 Shares Purchased by Institution in the Last 3 Months 0 Shares Sold by Institution in the Last 3 Months 0 3 Months Net Transactions (Purchases-Sales) N/A Quarterly Stock Price Range N/A Buyers/Sellers Summary Number of Inside Buyers Number of Inside Sellers

3 Months 6 Months 0 0 0 0

J P MORGAN CHASE & CO Total Shares Owned by Institution 119,898,606 Percentage of Shares Outstanding 99.47% Number of Institutions 2791 Shares Purchased by Institution in the Last 3 Months 0 Shares Sold by Institution in the Last 3 Months 0 3 Months Net Transactions (Purchases-Sales) N/A Quarterly Stock Price Range Time Period Low High Q1 of 2011 43.40 48.00 Q4 of 2010 36.96 42.67 Q3 of 2010 35.63 41.64

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Mergent, Inc.

Microsoft Corporation Time Period Low High Q2 of 2010 36.61 47.81 Q1 of 2010 37.70 45.02

Buyers/Sellers Summary Number of Inside Buyers Number of Inside Sellers

3 Months 6 Months 0 0 0 0

BANK OF NEW YORK MELLON CORP Total Shares Owned by Institution 117,551,484 Percentage of Shares Outstanding 99.5% Number of Institutions 3656 Shares Purchased by Institution in the Last 3 Months 0 Shares Sold by Institution in the Last 3 Months 0 3 Months Net Transactions (Purchases-Sales) N/A Quarterly Stock Price Range Time Period Low High Q1 of 2011 30.63 32.37 Q4 of 2010 24.93 30.52 Q3 of 2010 24.16 26.85 Q2 of 2010 24.69 32.54 Q1 of 2010 26.86 31.35

Buyers/Sellers Summary Number of Inside Buyers Number of Inside Sellers

3 Months 6 Months 0 0 0 0

NORTHERN TRUST CORP Total Shares Owned by Institution 107,341,135 Percentage of Shares Outstanding 99.05% Number of Institutions 3765 Shares Purchased by Institution in the Last 3 Months 0 Shares Sold by Institution in the Last 3 Months 0 3 Months Net Transactions (Purchases-Sales) N/A

02/20/2011

17

Mergent, Inc.

Microsoft Corporation Quarterly Stock Price Range Time Period Low High Q1 of 2011 51.69 56.55 Q4 of 2010 47.41 55.73 Q3 of 2010 45.81 50.50 Q2 of 2010 46.70 59.02 Q1 of 2010 49.89 55.98

Buyers/Sellers Summary Number of Inside Buyers Number of Inside Sellers

3 Months 6 Months 0 0 0 0

INVESCO LTD Total Shares Owned by Institution 98,771,214 Percentage of Shares Outstanding 99.36% Number of Institutions 3560 Shares Purchased by Institution in the Last 3 Months 0 Shares Sold by Institution in the Last 3 Months 0 3 Months Net Transactions (Purchases-Sales) N/A Quarterly Stock Price Range Time Period Low High Q1 of 2011 23.77 27.42 Q4 of 2010 21.06 24.24 Q3 of 2010 16.63 21.90 Q2 of 2010 16.83 23.66 Q1 of 2010 18.32 23.63

Buyers/Sellers Summary Number of Inside Buyers Number of Inside Sellers

3 Months 6 Months 0 0 0 0

Insider Holdings/Trades Ownership Summary for each of the top 5-10 Insiders There is no Insider Holdings / Trades information for this company at present.

Dividends Abbreviation Description Structure Type Exchange Ticker Market Cap Com Com Common NMS MSFT 227,368,456,920

02/20/2011

18

Mergent, Inc.

Microsoft Corporation

Com (NMS: MSFT) Ticker Listed MSFT NASDAQ National Market System

Outstanding Date Outstanding Par Amount 01/21/2011 8,402,382,031 0.00 USD

Stock Splits Split Date 1% 09/21/1987 1% 04/16/1990 3-for-2 06/27/1991 3-for-2 06/15/1992 2-for-1 05/23/1994 2-for-1 12/09/1996 2-for-1 02/23/1998 2-for-1 03/29/1999 2-for-1 02/18/2003 Issue Shares Outstanding Shares Outstanding Date 01/21/2011 10/22/2010 07/20/2010 04/19/2010 01/25/2010 10/19/2009 07/27/2009 04/20/2009 01/20/2009 10/20/2008 07/28/2008 04/21/2008 01/21/2008 10/22/2007 08/01/2007 04/23/2007 01/22/2007 10/23/2006 08/18/2006 04/14/2006 01/23/2006 01/23/2006 09/30/2005 08/15/2005 03/31/2005 12/31/2004 10/31/2004 08/15/2004 04/23/2004 01/31/2004 10/31/2003 08/15/2003 04/30/2003 02/18/2003

02/20/2011

Shares Outstanding 8,402,382,031 8,555,523,242 8,653,567,331 8,763,839,329 8,770,460,922 8,879,121,378 8,910,673,817 8,899,720,022 8,890,562,873 8,895,572,720 9,130,293,074 9,313,292,833 9,306,979,746 9,355,438,912 9,375,492,496 9,566,808,383 9,792,314,405 9,830,460,093 9,969,991,800 10,201,202,877 10,333,368,967 10,333,368,967 10,644,674,213 10,712,706,028 10,804,353,235 10,880,222,153 10,871,589,882 10,872,704,667 10,794,692,690 10,794,392,603 10,812,468,881 10,813,984,831 10,736,261,053 10,701,385,302

File Date 01/27/2011 10/28/2010 07/30/2010 04/22/2010 01/28/2010 10/23/2009 07/30/2009 04/23/2009 01/22/2009 10/23/2008 07/31/2008 04/24/2008 01/24/2008 10/25/2007 08/03/2007 04/26/2007 01/25/2007 10/26/2006 08/25/2006 04/27/2006 03/03/2006 01/26/2006 10/27/2005 08/26/2005 04/28/2005 01/27/2005 11/09/2004 09/01/2004 05/03/2004 02/06/2004 11/13/2003 09/05/2003 05/12/2003 02/18/2003

19

Report Date 12/31/2010 09/30/2010 06/30/2010 03/31/2010 12/31/2009 09/30/2009 06/30/2009 03/31/2009 12/31/2008 09/30/2008 06/30/2008 03/31/2008 12/31/2007 09/30/2007 06/30/2007 03/31/2007 12/31/2006 09/30/2006 06/30/2006 03/31/2006 12/31/2005 12/31/2005 09/30/2005 06/30/2005 03/31/2005 12/31/2004 09/30/2004 06/30/2004 03/31/2004 12/31/2003 09/30/2003 06/30/2003 03/31/2003 02/18/2003

Mergent, Inc.

Microsoft Corporation Shares Outstanding Date 12/31/2002 09/30/2002 07/31/2002 03/31/2002 02/28/2002 01/31/2002 09/30/2001 04/30/2001 01/31/2001 01/26/2001 10/31/2000 09/08/2000 10/31/1999 03/29/1999 06/30/1998 Recent Dividends Amount Record Date 0.16 12/15/2010 0.16 09/21/2010 0.13 06/16/2010 0.13 03/08/2010 0.13 12/09/2009 0.13 09/18/2009 0.13 06/10/2009 0.13 03/09/2009 0.13 12/10/2008 0.13 09/22/2008 0.11 06/11/2008 0.11 03/17/2008 0.11 12/19/2007 0.11 09/12/2007 0.10 06/27/2007 0.10 03/26/2007 0.10 12/20/2006 0.10 09/13/2006 0.09 06/22/2006 0.09 03/27/2006 0.09 12/14/2005

02/20/2011

Shares Outstanding 5,350,692,651 5,346,449,872 5,378,746,853 5,415,462,752 5,416,006,543 5,415,221,834 5,385,753,545 5,382,101,906 5,335,390,864 5,330,000,000 5,332,337,924 5,355,376,816 5,160,024,593 4,816,000,000 2,408,000,000

ExDiv Date 02/15/2011 11/16/2010 08/17/2010 05/18/2010 02/16/2010 11/17/2009 08/18/2009 05/19/2009 02/17/2009 11/18/2008 08/19/2008 05/13/2008 02/19/2008 11/13/2007 08/14/2007 05/15/2007 02/13/2007 11/14/2006 08/15/2006 05/15/2006 02/15/2006

File Date 01/31/2003 11/14/2002 09/06/2002 04/30/2002 03/25/2002

Report Date 12/31/2002 09/30/2002 06/30/2002 03/31/2002 09/30/2001

03/29/1999 03/29/1999

Pay Date 03/10/2011 12/09/2010 09/09/2010 06/10/2010 03/11/2010 12/10/2009 09/10/2009 06/18/2009 03/12/2009 12/11/2008 09/11/2008 06/12/2008 03/13/2008 12/13/2007 09/13/2007 06/14/2007 03/08/2007 12/14/2006 09/14/2006 06/08/2006 03/09/2006

20

Mergent, Inc.

Microsoft Corporation

Long Term Debt June 30, 2010, $5,000,000,000 (excluding current portion and including unamortized debt discount of $61,000,000) comprised of: -- 01 -- $1,250,000,000 zero coupon convertible notes, due June 15, 2013. -- 02 -- $3,750,000,000 notes, bearing interest at rates ranging from 2.95% to 5.20%, due from June 1, 2014 to June 1, 2039. Line of Credit: In Nov. 2009, Co. replaced its $2,000,000,000 and $1,000,000,000 credit facilities with a $2,250,000,000 364-day credit facility, which expires on Nov. 5, 2010. This facility serves as a back-up for Co.'s commercial paper program. In June 2010, Co. reduced the size of its credit facility from $2,250,000,000 to $1,000,000,000 due to the reduction in commercial paper outstanding. As of June 30, 2010, Co. was in compliance with the financial covenant in the credit facility agreement, which requires a coverage ratio be maintained of at least three times earnings before interest, taxes, depreciation, and amortization to interest expense. No amounts were drawn against the credit facility during the year ended June 30, 2010.

Expanded Long Term Debt CUSIP Issuer Name 594918203 MICROSOFT CORPORATION

Issue Description PFD SER A CONV EXCH PRIN

Ticker Coupon Maturity MSFT 2.75 12/15/1999

CUSIP Active 594918203 No

Subsidiaries SUBSIDIARY NAME Subsidiaries

02/20/2011

PERCENT OWNED

21

COUNTRY

Mergent, Inc.

Microsoft Corporation SUBSIDIARY NAME Subsidiaries Microsoft Ireland Research Microsoft Capital Group, LLC Microsoft Global Finance Microsoft Ireland Operations Limited Microsoft Licensing, GP Microsoft Online, Inc. Microsoft Operations Pte Ltd Microsoft Operations Puerto Rico, LLC Microsoft Regional Sales Corporation MOL Corporation

PERCENT OWNED

COUNTRY

100% 100% 100% 100%

Ireland United States Ireland Ireland

100% 100% 100% 100%

United States United States Singapore Puerto Rico

100%

United States

100%

United States

Property Co. maintains its corporate offices consisting of approx. 15,000,000 sq. ft. of office space in King County, WA: 10,000,000 sq. ft. of owned space situated on approx. 500 acres of land Co. owns at its corporate campus in Redmond, WA and approx. 5,000,000 sq. ft. of space Co. leases. Co. owns approx. 2,000,000 sq. ft. of office and datacenter space domestically (outside of the Puget Sound corporate campus) and lease many sites domestically totaling approx. 4,000,000 sq. ft. of office and datacenter space. Co. occupies many sites internationally, totaling approx. 2,000,000 sq. ft. that is owned and approx. 9,000,000 sq. ft. that is leased. International facilities that Co. owns include its India Development Center in Hyderabad, India; the European Operations Center in Dublin, Ireland; a research and development campus in Shaghai, China; and facilities in Reading and Atherstone, U.K. Co.'s primary leased office spaces include the following locations: Beijing and Shanghai, China; Tokyo, Japan; Unterschleissheim, Germany; Paris, France; Dublin, Ireland; Bangalore, India; Reading, U.K.; Vedbaek, Denmark; and Mississauga, Canada. In addition to the above locations, Co. has a disk duplication and digital distribution facility in Humacao, Puerto Rico, a facility in Singapore for its Asia Pacific Operations Center and Regional headquarters, and various product development facilities, both domestically and internationally. In addition, Co. owns 63 acres of undeveloped land in Issaquah, WA, that can accommodate approx. 1,000,000 sq. ft. of office space.

Principal Executive Offices One Microsoft Way Redmond, WA 98052-6399 United States

Competitors (USA) Company Name Hewlett-Packard Co McKesson Corp. International Business Machines Corp. Apple Inc

02/20/2011

Revenues 126,033,000,000 108,702,000,000 95,758,000,000

Gross Margin 23.76 5.22 45.72

Net Income 8,761,000,000 1,263,000,000 13,425,000,000

65,225,000,000

39.38

14,013,000,000 19,256,000,000

22

EBITDA 15,758,000,000 2,177,000,000 23,440,000,000

Mergent, Inc.

Microsoft Corporation Company Name Microsoft Corporation General Dynamics Corp. Oracle Corp. EMC Corp. (MA) Pitney Bowes Inc Unisys Corp. CA Inc Activision Blizzard, Inc. Insight Enterprises Inc. Adobe Systems, Inc. Electronic Arts, Inc. Intuit Inc CACI International Inc. Valassis Communications, Inc. LSI Corp Brocade Communications Systems, Inc. VMWARE, Inc. Plexus Corp. McAfee Inc BMC Software, Inc. Xilinx, Inc.

Revenues 62,484,000,000 32,466,000,000 26,820,000,000 14,025,910,000 5,569,171,000 4,597,700,000 4,353,000,000 4,279,000,000 4,136,905,000 3,800,000,000 3,654,000,000 3,455,000,000 3,149,131,000 2,244,248,000 2,219,159,000 2,094,363,000

Gross Margin 80.16 18.20 78.51 55.22 52.59 24.72 87.16 46.09 13.74 89.38 48.93 82.52 29.90 24.53 38.01 58.94

Net Income 18,760,000,000 2,624,000,000 6,135,000,000 1,088,077,000 444,913,000 189,300,000 771,000,000 113,000,000 33,574,000 774,680,000 (677,000,000) 574,000,000 106,515,000 66,768,000 (47,719,000) 118,852,000

EBITDA 26,121,000,000 4,516,000,000 11,241,000,000 2,122,575,000 1,166,882,000 786,900,000 1,492,000,000 57,000,000 78,772,000 1,156,599,000 (540,000,000) 1,119,000,000 208,682,000 265,286,000 (70,571,000) 260,898,000

2,023,937,000 2,013,393,000 1,927,332,000 1,911,200,000 1,833,554,000

82.23 10.28 74.76 78.48 63.36

197,098,000 89,533,000 173,420,000 406,100,000 357,484,000

332,707,000 138,742,000 394,300,000 580,500,000 481,665,000

Company Name Hewlett-Packard Co McKesson Corp. International Business Machines Corp. Apple Inc Microsoft Corporation General Dynamics Corp. Oracle Corp. EMC Corp. (MA) Pitney Bowes Inc Unisys Corp. CA Inc Activision Blizzard, Inc. Insight Enterprises Inc. Adobe Systems, Inc. Electronic Arts, Inc. Intuit Inc CACI International Inc. Valassis Communications, Inc. LSI Corp Brocade Communications Systems, Inc. VMWARE, Inc. Plexus Corp. McAfee Inc BMC Software, Inc.

Total Assets 124,503,000,000 28,189,000,000 109,022,000,000

Total Liabilities 84,054,000,000 20,657,000,000 86,385,000,000

PE Ratio 13.5194 17.8407 14.9991

Market Cap 106,608 M 20,504 M 204,791 M

Employees 324,600 32,500 437,776

75,183,000,000 86,113,000,000 32,545,000,000 61,578,000,000 26,812,003,000 8,533,911,000 2,956,900,000 11,838,000,000 13,742,000,000 1,603,321,000 8,141,148,000 4,646,000,000 5,198,000,000 2,244,766,000 1,744,022,000 2,967,930,000 3,654,175,000

27,392,000,000 39,938,000,000 19,229,000,000 30,780,000,000 11,262,121,000 8,520,248,000 4,225,200,000 6,855,000,000 2,986,000,000 1,135,747,000 2,948,761,000 1,917,000,000 2,377,000,000 1,074,053,000 1,646,161,000 1,506,826,000 1,607,874,000

23.1393 11.6638 12.0169 25.1343 34.8462 9.5571 16.2645 36.9 12.4626 39.3222 32.4012 16.3278 4.2257 37.5 21.2667

322,963 M 227,368 M 29,112 M 170,166 M 56,002 M 5,236 M 1,748 M 12,858 M 13,351 M 848 M 17,862 M 6,446 M 16,807 M 1,787 M 1,519 M 4,162 M 2,977 M

46,600 89,000 90,000 105,000 43,200 33,004 25,600 13,800 7,000 4,898 9,117 7,800 7,700 13,100 7,440 5,397 4,651

5,066,984,000 1,290,379,000 3,963,186,000 4,137,600,000

2,324,033,000 638,524,000 1,845,648,000 2,749,900,000

124.9859 14.9817 42.7768 20.6397

10,152 M 1,330 M 7,385 M 9,106 M

7,100 8,700 6,100 6,100

02/20/2011

23

Mergent, Inc.

Microsoft Corporation Company Name Xilinx, Inc.

Total Assets 3,184,318,000

Company Name Hewlett-Packard Co McKesson Corp. International Business Machines Corp. Apple Inc Microsoft Corporation General Dynamics Corp. Oracle Corp. EMC Corp. (MA) Pitney Bowes Inc Unisys Corp. CA Inc Activision Blizzard, Inc. Insight Enterprises Inc. Adobe Systems, Inc. Electronic Arts, Inc. Intuit Inc CACI International Inc. Valassis Communications, Inc. LSI Corp Brocade Communications Systems, Inc. VMWARE, Inc. Plexus Corp. McAfee Inc BMC Software, Inc. Xilinx, Inc.

Share Price 48.67 80.64 164.84

Total Liabilities PE Ratio Market Cap Employees 1,063,848,000 15.7767 8,855 M 2,948

350.56 27.06 78.11 33.68 27.18 25.75 41.00 25.21 11.07 18.32 35.39 19.28 54.11 58.78 30.59 6.75 6.38 88.74 32.81 47.91 50.98 33.92

Earnings Estimates Broker Summary Number of Analysts Number of Buy Recommendations Number of Hold Recommendations Number of Sell Recommendations

Ratios and Statistics EPS Long-Term Growth Forward P/E PEG

02/20/2011

35 9 0 0

11.00

24

Mergent, Inc.

Microsoft Corporation

Average Target Price $32.33 Price Target Raised in the Past 4 Wks - 1 (DOWN) 2 (UP) 1 Price Target Lowered in the Past 4 Wks - 2 Consensus Estimates Summary 2008A Earnings Per Share 1.87 Revenue 60,420.00 EBITDA 25,965.00

2009A 1.70 58,437.00 23,161.00

2012E 2.63 73,228.00 32,075.45

2013E 2.90 79,243.00 34,919.85

Earnings Per Share Revenue EBITDA

2010A 2.10 62,484.00 26,771.00

Q12011E 0.54 16,050.00 6,900.59

Q22011E 0.59 17,204.50 7,430.00

Q32011E 0.62 17,162.53 7,409.95

Q42011E 0.74 20,156.09 9,196.43

2011E 2.37 68,086.50 29,357.50

Earnings Estimates Consensus Estimates Detailed Earnings Per Share 2008A High Median 1.87 Low Standard Deviation 0.01 # of Estimates 23

2009A 1.70 0.02 18

2010A 2.10 0.03 34

Q12011E 0.59 0.54 0.50 0.02 31

Q22011E 0.64 0.59 0.54 0.03 30

Q32011E 0.68 0.62 0.50 0.04 21

Q42011E 0.86 0.74 0.69 0.04 21

2011E 2.46 2.37 2.05 0.08 35

2012E 2.82 2.63 2.42 0.10 32

2013E 3.34 2.90 2.71 0.20 8

Dividend Per Share High Median Low Standard Deviation # of Estimates

2009A 0.52 0.01 4

2010A 0.52 0.01 10

Q12011E 0.16 0.16 0.13 0.02 3

Q22011E 0.16 0.16 0.13 0.02 3

Q32011E 0.19 0.16 0.13 0.04 2

Q42011E 0.19 0.16 0.13 0.04 2

2011E 0.64 0.52 0.50 0.05 11

2012E 0.76 0.52 0.52 0.08 10

2013E 0.64 0.52 0.52 0.05 5

2008A 0.44 0.01 7

Cash Flow Per Share High Median Low Standard Deviation # of Estimates

02/20/2011

2008A 2.28 0.12 5

2009A 2.12 0.10 5

2010A 2.70 0.17 7

Q12011E 0.98 0.89 0.65 0.12 7

Q22011E 0.85 0.71 0.57 0.11 7

25

Q32011E 0.88 0.77 0.58 0.13 4

Q42011E 0.97 0.80 0.71 0.13 4

2011E 3.13 2.89 2.34 0.24 9

2012E 3.55 3.32 2.98 0.20 8

2013E 3.87 3.43 3.15 0.36 3

Mergent, Inc.

Microsoft Corporation Sales High Median Low Standard Deviation # of Estimates

2008A 60,420.00 134.03 31

2009A 58,437.00 332.95 24

Sales High Median Low Standard Deviation # of Estimates

2012E 76,193.52 73,228.00 68,810.00 1,766.47 30

2013E 81,401.20 79,243.00 76,016.71 1,932.89 7

Operating Profit High Median Low Standard Deviation # of Estimates

2008A 23,909.00 102.78 13

2009A 20,889.00 222.27 16

Operating Profit High Median Low Standard Deviation # of Estimates

2012E 31,075.00 29,339.50 26,238.25 1,221.29 24

2013E 24,519.00 24,519.00 24,519.00 0.00 1

EBITDA High Median Low Standard Deviation # of Estimates

2008A 25,965.00 331.46 7

2009A 23,161.00 236.19 6

EBITDA High Median Low Standard Deviation # of Estimates

2012E 32,864.00 32,075.45 28,691.31 1,466.01 8

2013E 36,720.40 34,919.85 32,262.66 1,784.30 6

Net Debt High Median Low Standard Deviation # of Estimates

2008A 0.00 3,448.21 5

Net Debt High

2011E 2012E 2013E -33,845.46 -37,739.92 -43,823.28

02/20/2011

2009A -330.00 4,389.60 5

2010A 62,484.00 233.92 32

Q12011E 16,699.09 16,050.00 15,097.00 348.11 29

Q22011E 17,815.00 17,204.50 15,943.80 411.76 28

2010A 24,098.00 208.61 28

Q12011E 6,838.00 6,144.50 5,669.50 275.73 26

Q22011E 7,172.00 6,559.10 6,229.00 263.77 25

Q32011E 7,379.00 6,836.00 6,522.00 254.95 15

Q42011E 9,300.00 8,378.00 7,997.00 435.89 15

2011E 28,139.00 26,652.00 24,422.00 778.25 31

2010A 26,771.00 416.61 9

Q12011E 7,101.00 6,900.59 6,549.00 207.33 5

Q22011E 7,591.00 7,430.00 6,985.00 264.56 5

Q32011E 7,460.00 7,409.95 7,359.90 70.78 2

Q42011E 9,223.87 9,196.43 9,169.00 38.80 2

2011E 30,249.20 29,357.50 27,288.00 890.18 10

2010A -30,849.00 5,857.34 8

Q12011E -33,280.16 -44,066.00 -54,277.00 8,655.45 4

26

Q22011E -33,845.46 -47,513.50 -58,310.00 10,419.52 4

Q32011E 17,887.00 17,162.53 16,307.00 413.86 17

Q32011E -32,848.38 -47,382.00 -60,930.00 14,043.69 3

Q42011E 21,244.00 20,156.09 18,779.00 698.69 17

2011E 69,654.22 68,086.50 65,126.00 948.22 34

Q42011E -33,955.60 -49,757.00 -64,069.00 15,062.84 3

Mergent, Inc.

Microsoft Corporation Net Debt Median Low Standard Deviation # of Estimates

2011E -44,022.00 -58,310.00 8,800.60 9

2012E -52,423.18 -73,926.00 11,378.28 8

Pre Tax Profit High Median Low Standard Deviation # of Estimates

2008A 25,231.00 427.54 15

2009A 20,769.00 407.51 13

Pre Tax Profit High Median Low Standard Deviation # of Estimates

2012E 32,900.00 30,237.50 27,151.80 1,377.26 28

2013E 33,452.00 32,533.78 30,692.60 1,099.91 6

2013E -63,111.00 -64,598.00 9,111.86 5

2010A 25,013.00 367.18 30

Q12011E 7,238.00 6,291.00 5,869.50 296.92 27

Q22011E 7,322.00 6,834.50 6,343.00 271.83 26

Q32011E 7,600.00 7,073.00 6,616.00 302.35 17

Q42011E 9,800.00 8,795.00 8,167.00 424.58 17

2011E 29,200.00 27,412.00 24,282.00 909.97 34

Financial Highlights Financial Highlights as of 06/30/2010 in USD Income Statement Total Revenue EBITDA Operating Income Net Income Revenue per Share EPS from Continuing Operations EPS - Net Income - Diluted Share Outstanding Weighted Average Shares Outstanding - Diluted Weighted Average Shares Outstanding - Basic Earnings per Share - Basic Balance Sheet Total Assets Current Assets Total Liabilities Long Term Debt Stockholders' Equity Total Assets per Share Current Liabilities Net Assets per Share Cash Flow Statement Cash from Operations Cash from Investing Cash from Financing Capital Expenditures Cash Flow per Share

02/20/2011

(In Thousands) 62,484,000 26,121,000 24,098,000 18,760,000 7.09 2.10 2.10 8,668,000 8,813,000 8,927,000 2.13 (In Thousands) 86,113,000 55,676,000 39,938,000 4,939,000 46,175,000 9.93 26,147,000 5.33 (In Thousands) 24,073,000 (11,314,000) (13,291,000) 1,977,000 2.70

27

Mergent, Inc.

Microsoft Corporation Cash & Cash Equivalents, Beginning of Year Cash & Cash Equivalents, End of Year Stock Price and Valuation (Data as of 02/18/2011) Market Cap(mil) Share Outstanding(000's) PE Ratio Dividend Per Share(TTM) Earning Per Share(TTM) Last Closing Price Previous Trading Day Range 52 Week Range 7 Day Average Closing Price 30 Day Average Closing Price 200 Day Average Closing Price Beta High Price Last 3 Mos. Low Price Last 3 Mos. Avg Daily Volume Last 3 Mos.

6,076,000 5,505,000 227,368 8,402,382 11.6638 0.58 2.39 27.06 26.99 - 27.21 23.01 - 31.39 27.12 27.86 26.22 0.92 28.87 25.12 57,296,696.84

Management Effectiveness Revenue per Employee Net Income per Employee ROA % (Net) ROE % (Net) ROI % (Operating) Profitability Ratios Gross Margin Operating Margin EBITDA Margin % Calculated Tax Rate % Profit Margin (TTM) Valuation Ratios Price/Earnings (TTM) Price/Book (TTM) Price/Cash Flow(TTM) Asset Management Total Asset Turnover Receivables Turnover Inventory Turnover Property Plant & Equip Turnover Cash & Equivalents Turnover Debt Management Long Term Debt/Equity Long Term Debt as % of Invested Capital Total Debt/Equity Accounts Payable Turnover Accrued Expenses Turnover Liquidity Indicators Quick Ratio Current Ratio Net Current Assets as % of Total Assets

02/20/2011

702,067 210,787 22.88 43.76 49.47 80.16 38.57 41.80 25.00 30.02 10.80 4.32 8.42 0.76 5.16 17.01 8.24 10.79 0.11 9.48 0.13 17.00 19.41 0.71 2.13 34.29

28

Mergent, Inc.

Microsoft Corporation Free Cash Flow per Share Revenue to Assets Consensus Estimates Earnings Per Share Revenue EBITDA

2.51 0.73 2011Ae 2010Q3e 2010Q4e 2.37 0.55 0.69 68,086.50 15,818.35 19,054.00 29,357.50 6,895.00 8,484.00

3 yr As Reported Annuals Income Statement Exchange rate used is that of the Year End reported date As Reported Annual Income Statement Report Date 06/30/2010 Currency USD Audit Status Not Qualified Consolidated Yes Scale Thousands Revenue 62,484,000 Cost of revenue 12,395,000 Research & development expense 8,714,000 Sales & marketing expense 13,214,000 General & administrative expense 4,004,000 Employee severance 59,000 Total operating expenses 38,386,000 Operating income (loss) 24,098,000 Dividends & interest income 843,000 Interest expense 151,000 Net recognized gains (losses) on 348,000 investments Net gains (losses) on derivatives (140,000) Net gains (losses) on foreign currency 1,000 remeasurements Other investment income (losses) Other income (expense) 14,000 Investment income & other Total other income (expense) 915,000 Income (loss) before income taxes 9,575,000 United States Income (loss) before income taxes 15,438,000 International Income (loss) before income taxes 25,013,000 Current taxes provision (benefit)- U.S. 4,415,000 federal Current taxes provision (benefit) 357,000 U.S. state & local Current taxes provision (benefit) 1,701,000 international Current taxes provision (benefit) 6,473,000 total Deferred taxes provision (benefit) (220,000) total Provision (benefit) for income taxes 6,253,000

02/20/2011

29

06/30/2009 USD Not Qualified Yes Thousands 58,437,000 12,155,000 9,010,000 12,879,000 3,700,000 330,000 38,074,000 20,363,000 706,000 (125,000)

06/30/2008 USD Not Qualified Yes Thousands 60,420,000 11,598,000 8,164,000 13,039,000 5,127,000 37,928,000 22,492,000 888,000 346,000

(558,000) (509,000)

226,000 -

(56,000) (542,000) 5,529,000

(138,000) 1,322,000 12,682,000

14,292,000

11,132,000

19,821,000 3,159,000

23,814,000 4,357,000

192,000

256,000

1,139,000

1,007,000

4,490,000

5,620,000

762,000

513,000

5,252,000

6,133,000

Mergent, Inc.

Microsoft Corporation Report Date Currency Audit Status Consolidated Scale Net income (loss) Weighted average shares outstanding basic Weighted average shares outstanding diluted Year end shares outstanding Net earnings (loss) per share-basic Net earnings (loss) per share-diluted Cash dividends declared per common share Number of full time employees Number of common stockholders

06/30/2010 USD Not Qualified Yes Thousands 18,760,000 8,813,000

06/30/2009 USD Not Qualified Yes Thousands 14,569,000 8,945,000

06/30/2008 USD Not Qualified Yes Thousands 17,681,000 9,328,000

8,927,000

8,996,000

9,470,000

8,668,000 2.13 2.1 0.52 89,000 138,568

8,908,000 1.63 1.62 0.52 93,000 142,468

9,151,000 1.9 1.87 0.44 91,000 145,903

3 yr As Reported Annuals Balance Sheet Exchange rate used is that of the Year End reported date As Reported Annual Balance Sheet Report Date 06/30/2010 Currency USD Audit Status Not Qualified Consolidated Yes Scale Thousands Cash & cash equivalents 5,505,000 Short-term investments 31,283,000 Total cash, cash equivalents, & 36,788,000 short-term investments Accounts receivable, gross 13,389,000 Less: allowance for doubtful accounts 375,000 Accounts receivable, net 13,014,000 Raw materials 172,000 Work in process 16,000 Finished goods 552,000 Inventories 740,000 Deferred income taxes 2,184,000 Other current assets 2,950,000 Total current assets 55,676,000 Land 526,000 Buildings & improvements 6,087,000 Leasehold improvments 2,100,000 Computer equipment & software 5,673,000 Furniture & equipment 1,873,000 Property & equipment, at cost 16,259,000 Less: accumulated depreciation 8,629,000 Property & equipment, net 7,630,000 Equity & other investments 7,754,000 Goodwill 12,394,000 Intangible assets, net 1,158,000

02/20/2011

30

06/30/2009 USD Not Qualified Yes Thousands 6,076,000 25,371,000 31,447,000

06/30/2008 USD Not Qualified Yes Thousands 10,339,000 13,323,000 23,662,000

11,643,000 451,000 11,192,000 170,000 45,000 502,000 717,000 2,213,000 3,711,000 49,280,000 526,000 5,886,000 1,938,000 4,989,000 1,743,000 15,082,000 7,547,000 7,535,000 4,933,000 12,503,000 1,759,000

13,742,000 153,000 13,589,000 417,000 31,000 537,000 985,000 2,017,000 2,989,000 43,242,000 518,000 4,302,000 1,728,000 4,475,000 1,521,000 12,544,000 6,302,000 6,242,000 6,588,000 12,108,000 1,973,000

Mergent, Inc.

Microsoft Corporation Report Date Currency Audit Status Consolidated Scale Deferred income taxes Other long-term assets Total assets Accounts payable Short-term debt Accrued compensation Income taxes Short-term unearned revenue Securities lending payable Other current liabilities Total current liabilities Zero coupon convertible notes Notes Unamortized debt discount Long-term debt Long-term unearned revenue Deferred income taxes Tax contingencies & other tax liabilities Legal contingencies Product warranty Other long-term liabilities Other long-term liabilities Common stock & paid-in capital Retained earnings (accumulated deficit) Total stockholders' equity

06/30/2010 USD Not Qualified Yes Thousands 0 1,501,000 86,113,000 4,025,000 1,000,000 3,283,000 1,074,000 13,652,000 182,000 2,931,000 26,147,000 1,250,000 3,750,000 (61,000) 4,939,000 1,178,000 229,000 6,887,000

06/30/2009 USD Not Qualified Yes Thousands 279,000 1,599,000 77,888,000 3,324,000 2,000,000 3,156,000 725,000 13,003,000 1,684,000 3,142,000 27,034,000 3,750,000 (4,000) 3,746,000 1,281,000 5,515,000

06/30/2008 USD Not Qualified Yes Thousands 949,000 1,691,000 72,793,000 4,034,000 2,934,000 3,248,000 13,397,000 2,614,000 3,659,000 29,886,000 1,900,000 3,812,000

236,000 69,000 253,000 7,445,000 62,856,000 (16,681,000) 46,175,000

407,000 132,000 215,000 6,269,000 62,382,000 (22,824,000) 39,558,000

530,000 278,000 101,000 4,721,000 62,849,000 (26,563,000) 36,286,000

3 yr As Reported Annuals Cash Flows Exchange rate used is that of the Year End reported date As Reported Annual Cash Flow Report Date 06/30/2010 Currency USD Audit Status Not Qualified Consolidated Yes Scale Thousands Net income (loss) 18,760,000 Depreciation, amortization, & other 2,673,000 noncash items Stock-based compensation 1,891,000 Net recognized (gains) losses on investments Net recognized (gains) losses on (208,000) investments & derivatives Excess tax benefits from stock-based payment arrangements

02/20/2011

06/30/2009 USD Not Qualified Yes Thousands 14,569,000 2,562,000

06/30/2008 USD Not Qualified Yes Thousands 17,681,000 2,056,000

1,708,000 683,000

1,479,000 (572,000)

-

-

(52,000)

(120,000)

31

Mergent, Inc.

Microsoft Corporation Report Date Currency Audit Status Consolidated Scale Excess tax benefits from stock based compensation Deferred income taxes Deferral of unearned revenue Recognition of unearned revenue Accounts receivable Other current assets Other long-term assets Other current liabilities Other long-term liabilities Net cash flows from operating activities Short-term borrowings (repayments), maturities of 90 days or less, net Proceeds from issuance of debt, maturities longer than 90 days Repayments of debt, maturities longer than 90 days Common stock issued Common stock repurchased Common stock cash dividends Excess tax benefits from stock-based payment arrangements Excess tax benefits from stock based compensation Other financing activities, net Net cash flows from financing activities Additions to property & equipment Acquisitions of companies, net of cash acquired Purchase of investments Maturities of investments Sales of investments Securities lending payable Net cash flows from investing activities Effect of exch rates on cash & cash equivalents Net change in cash & cash equivalents Cash & cash equivalents, beginning of period Cash & cash equivalents, end of yperiod

06/30/2010 USD Not Qualified Yes Thousands (45,000)

06/30/2009 USD Not Qualified Yes Thousands -

06/30/2008 USD Not Qualified Yes Thousands -

(220,000) 29,374,000 (28,813,000) (2,238,000) 420,000 (223,000) 1,295,000 1,407,000 24,073,000 (991,000)

762,000 24,409,000 (25,426,000) 2,215,000 (422,000) (273,000) (3,371,000) 1,673,000 19,037,000 1,178,000

935,000 24,532,000 (21,944,000) (1,569,000) 153,000 (98,000) (748,000) (173,000) 21,612,000 -

4,167,000

4,796,000

-

(2,986,000)

(228,000)

-

2,311,000 (11,269,000) (4,578,000) -

579,000 (9,353,000) (4,468,000) 52,000

3,494,000 (12,533,000) (4,015,000) 120,000

45,000

-

-

10,000 (13,291,000) (1,977,000) (245,000)

(19,000) (7,463,000) (3,119,000) (868,000)

(12,934,000) (3,182,000) (8,053,000)

(30,168,000) 7,453,000 15,125,000 (1,502,000) (11,314,000) (39,000)

(36,850,000) 6,191,000 19,806,000 (930,000) (15,770,000) (67,000)

(20,954,000) 2,597,000 25,132,000 (127,000) (4,587,000) 137,000

(571,000)

(4,263,000)

4,228,000

6,076,000

10,339,000

6,111,000

5,505,000

6,076,000

10,339,000

3 yr As Reported Quarters Income Statement Exchange rate used is that of the Year End reported date As Reported Quarterly Income Statement 02/20/2011

32

Mergent, Inc.

Microsoft Corporation Report Date Currency Audit Status Consolidated Scale Revenue Cost of revenue Research & development expenses Sales & marketing expenses General & administrative expenses Employee severance Total operating expenses Operating income (loss) Dividends & interest income Interest expense Net recognized gains (losses) on investments Net gains (losses) on derivatives Net gains (losses) on foreign currency remeasurements Other income (expense) Other income (expense) Income (loss) before income taxes Provision for income taxes Net income (loss) Weighted average shares outstanding basic Weighted average shares outstanding diluted Year end shares outstanding Net earnings (loss) per share - basic Net earnings (loss) per share - diluted Cash dividends declared per common share Report Date Currency Audit Status Consolidated Scale Revenue Cost of revenue Research & development expenses Sales & marketing expenses General & administrative expenses Employee severance Total operating expenses Operating income (loss) Dividends & interest income Interest expense

02/20/2011

12/31/2010 2nd Quarter USD Unaudited Yes Thousands 19,953,000 4,833,000 2,185,000 3,825,000 945,000 11,788,000 8,165,000 205,000 72,000 118,000

09/30/2010 1st Quarter USD Unaudited Yes Thousands 16,195,000 3,139,000 2,196,000 2,806,000 938,000 9,079,000 7,116,000 210,000 45,000 34,000

03/31/2010 3rd Quarter USD Unaudited Yes Thousands 14,503,000 2,755,000 2,220,000 3,203,000 1,152,000 0 9,330,000 5,173,000 166,000 137,000

12/31/2009 2nd Quarter USD Unaudited Yes Thousands 19,022,000 3,628,000 2,079,000 3,619,000 1,124,000 59,000 10,509,000 8,513,000 159,000 92,000

108,000 (27,000)

(5,000) (42,000)

(69,000) (56,000)

96,000 (23,000)

332,000 8,497,000 1,863,000 6,634,000 8,497,000

(38,000) 114,000 7,230,000 1,820,000 5,410,000 8,614,000

(10,000) 168,000 5,341,000 1,335,000 4,006,000 8,767,000

46,000 370,000 8,883,000 2,221,000 6,662,000 8,856,000

8,570,000

8,695,000

8,876,000

8,951,000

8,403,000 0.78 0.77 0.16

8,562,000 0.63 0.62 0.16

8,762,000 0.46 0.45 0.13

8,811,000 0.75 0.74 0.13

12/31/2008 2nd Quarter USD Unaudited Yes Thousands 16,629,000 3,907,000 2,290,000 3,662,000 831,000 10,690,000 5,939,000 175,000 -

09/30/2008 1st Quarter USD Unaudited Yes Thousands 15,061,000 2,848,000 2,283,000 3,044,000 887,000 9,062,000 5,999,000 207,000 -

09/30/2009 1st Quarter USD Unaudited Yes Thousands 12,920,000 2,842,000 2,065,000 2,790,000 741,000 8,438,000 4,482,000 165,000 -

33

03/31/2009 3rd Quarter USD Unaudited Yes Thousands 13,648,000 2,814,000 2,212,000 2,981,000 913,000 290,000 9,210,000 4,438,000 164,000 -

Mergent, Inc.

Microsoft Corporation Report Date Currency Audit Status Consolidated Scale Net recognized gains (losses) on investments Net gains (losses) on derivatives Net gains (losses) on foreign currency remeasurements Other income (expense) Other income (expense) Income (loss) before income taxes Provision for income taxes Net income (loss) Weighted average shares outstanding basic Weighted average shares outstanding diluted Year end shares outstanding Net earnings (loss) per share - basic Net earnings (loss) per share - diluted Cash dividends declared per common share

09/30/2009 1st Quarter USD Unaudited Yes Thousands 70,000

03/31/2009 3rd Quarter USD Unaudited Yes Thousands (452,000)

12/31/2008 2nd Quarter USD Unaudited Yes Thousands 270,000

09/30/2008 1st Quarter USD Unaudited Yes Thousands 129,000

(4,000) 55,000

(55,000) (26,000)

(409,000) (350,000)

(165,000) (179,000)

(3,000) 283,000 4,765,000 1,191,000 3,574,000 8,914,000

(19,000) (388,000) 4,050,000 1,073,000 2,977,000 8,891,000

13,000 (301,000) 5,638,000 1,464,000 4,174,000 8,903,000

(8,000) 5,991,000 1,618,000 4,373,000 9,084,000

8,983,000

8,904,000

8,914,000

9,183,000

8,900,000 0.4 0.4 0.13

8,898,000 0.33 0.33 0.13

8,889,000 0.47 0.47 0.13

8,977,000 0.48 0.48 0.13

3 yr As Reported Quarters Balance Sheet Exchange rate used is that of the Year End reported date As Reported Quarterly Balance Sheet Report Date 12/31/2010 2nd Quarter Currency USD Audit Status Unaudited Consolidated Yes Scale Thousands Cash & cash equivalents 4,023,000 Short-term investments 37,229,000 Total cash, cash equivalents & 41,252,000 short-term investments Accounts receivable, gross 13,191,000 Less: allowance for doubtful accounts 317,000 Accounts receivable, net 12,874,000 Raw materials 151,000 Work in process 54,000 Finished goods 656,000 Inventories 861,000 Deferred income taxes 2,548,000 Other current assets 2,149,000 Total current assets 59,684,000 Property & equipment, gross 17,078,000 Less: accumulated depreciation 9,279,000

02/20/2011

34

09/30/2010 1st Quarter USD Unaudited Yes Thousands 8,161,000 36,012,000 44,173,000

03/31/2010 3rd Quarter USD Unaudited Yes Thousands 8,155,000 31,511,000 39,666,000

12/31/2009 2nd Quarter USD Unaudited Yes Thousands 9,422,000 26,677,000 36,099,000

9,958,000 312,000 9,646,000 189,000 10,000 1,043,000 1,242,000 2,344,000 2,176,000 59,581,000 16,713,000 8,942,000

9,518,000 381,000 9,137,000 120,000 4,000 377,000 501,000 2,222,000 2,992,000 54,518,000 15,765,000 8,393,000

11,702,000 506,000 11,196,000 100,000 11,000 478,000 589,000 2,056,000 2,547,000 52,487,000 15,572,000 8,170,000

Mergent, Inc.

Microsoft Corporation Report Date Currency Audit Status Consolidated Scale Property & equipment, net Equity & other investments Goodwill Intangible assets, gross Less: total accumulated amortization Intangible assets, net Deferred income taxes Other long-term assets Total assets Accounts payable Short-term debt Accrued compensation Income taxes Short-term unearned revenue Securities lending payable Other current liabilities Total current liabilities Notes Convertible debt Total unamortized discount Long-term debt Long-term unearned revenue Deferred income taxes Other long-term liabilities Total liabilities Common stock & paid-in capital Retained earnings (accumulated deficit) Total stockholders' equity Report Date Currency Audit Status Consolidated Scale Cash & cash equivalents Short-term investments Total cash, cash equivalents & short-term investments Accounts receivable, gross Less: allowance for doubtful accounts Accounts receivable, net Raw materials Work in process Finished goods

02/20/2011

12/31/2010 2nd Quarter USD Unaudited Yes Thousands 7,799,000 10,022,000 12,502,000 992,000 1,307,000 92,306,000 3,863,000 2,402,000 1,439,000 12,063,000 1,355,000 3,190,000 24,312,000 8,500,000 1,250,000 (79,000) 9,671,000 1,354,000 826,000 7,662,000 43,825,000 61,646,000 (13,165,000) 48,481,000

09/30/2010 1st Quarter USD Unaudited Yes Thousands 7,771,000 9,211,000 12,471,000 1,077,000 1,429,000 91,540,000 3,654,000 1,000,000 2,252,000 2,136,000 12,767,000 909,000 3,139,000 25,857,000 9,665,000 1,152,000 540,000 7,384,000 44,598,000 61,935,000 (14,993,000) 46,942,000

03/31/2010 3rd Quarter USD Unaudited Yes Thousands 7,372,000 7,797,000 12,463,000 3,940,000 2,658,000 1,282,000 0 1,478,000 84,910,000 3,279,000 2,249,000 2,885,000 901,000 11,171,000 2,794,000 3,145,000 26,424,000 3,746,000 1,089,000 828,000 7,113,000 62,517,000 (16,807,000) 45,710,000

12/31/2009 2nd Quarter USD Unaudited Yes Thousands 7,402,000 6,976,000 12,368,000 1,346,000 1,517,000 82,096,000 3,171,000 2,249,000 2,417,000 721,000 11,361,000 2,911,000 2,885,000 25,715,000 3,746,000 1,167,000 377,000 6,808,000 62,566,000 (18,283,000) 44,283,000

09/30/2009 1st Quarter USD Unaudited Yes Thousands 8,823,000 27,905,000 36,728,000

03/31/2009 3rd Quarter USD Unaudited Yes Thousands 7,285,000 18,055,000 25,340,000

12/31/2008 2nd Quarter USD Unaudited Yes Thousands 8,346,000 12,369,000 20,715,000

09/30/2008 1st Quarter USD Unaudited Yes Thousands 9,004,000 11,718,000 20,722,000

9,023,000 436,000 8,587,000 165,000 30,000 955,000

9,424,000 242,000 9,182,000 173,000 58,000 426,000

11,207,000 254,000 10,953,000 263,000 57,000 648,000

9,703,000 168,000 9,535,000 402,000 58,000 1,180,000

35

Mergent, Inc.

Microsoft Corporation Report Date Currency Audit Status Consolidated Scale Inventories Deferred income taxes Other current assets Total current assets Property & equipment, gross Less: accumulated depreciation Property & equipment, net Equity & other investments Goodwill Intangible assets, gross Less: total accumulated amortization Intangible assets, net Deferred income taxes Other long-term assets Total assets Accounts payable Short-term debt Accrued compensation Income taxes Short-term unearned revenue Securities lending payable Other current liabilities Total current liabilities Notes Convertible debt Total unamortized discount Long-term debt Long-term unearned revenue Deferred income taxes Other long-term liabilities Total liabilities Common stock & paid-in capital Retained earnings (accumulated deficit) Total stockholders' equity

09/30/2009 1st Quarter USD Unaudited Yes Thousands 1,150,000 2,441,000 3,325,000 52,231,000 15,365,000 7,853,000 7,512,000 6,006,000 12,582,000 1,653,000 1,628,000 81,612,000 3,287,000 2,250,000 2,224,000 847,000 13,567,000 3,534,000 3,052,000 28,761,000 3,746,000 1,201,000 155,000 6,537,000 62,293,000 (21,081,000) 41,212,000

03/31/2009 3rd Quarter USD Unaudited Yes Thousands 657,000 1,926,000 3,619,000 40,724,000 14,348,000 7,236,000 7,112,000 4,112,000 12,554,000 1,756,000 956,000 1,639,000 68,853,000 3,017,000 1,999,000 2,644,000 773,000 10,924,000 1,533,000 2,933,000 23,823,000 1,388,000 6,699,000 61,896,000 (24,953,000) 36,943,000

12/31/2008 2nd Quarter USD Unaudited Yes Thousands 968,000 1,504,000 3,590,000 37,730,000 13,955,000 6,959,000 6,996,000 3,922,000 12,490,000 1,815,000 1,109,000 1,724,000 65,786,000 3,533,000 2,000,000 2,239,000 848,000 11,532,000 469,000 3,089,000 23,710,000 1,534,000 6,064,000 61,392,000 (26,914,000) 34,478,000

09/30/2008 1st Quarter USD Unaudited Yes Thousands 1,640,000 1,974,000 3,331,000 37,202,000 13,174,000 6,622,000 6,552,000 4,381,000 12,291,000 1,899,000 1,041,000 1,751,000 65,117,000 3,351,000 1,975,000 2,138,000 514,000 11,815,000 1,070,000 3,520,000 24,383,000 1,662,000 5,478,000 61,655,000 (28,061,000) 33,594,000

3 yr As Reported Quarters Cash Flows Exchange rate used is that of the Year End reported date As Reported Quarterly Cash Flow Report Date 12/31/2010 2nd Quarter Currency USD Audit Status Unaudited Consolidated Yes Scale Thousands

02/20/2011

09/30/2010 1st Quarter USD Unaudited Yes Thousands

36

03/31/2010 3rd Quarter USD Unaudited Yes Thousands

12/31/2009 2nd Quarter USD Unaudited Yes Thousands

09/30/2009 1st Quarter USD Unaudited Yes Thousands

Mergent, Inc.

Microsoft Corporation Report Date Currency Audit Status Consolidated Scale Net income (loss) Depreciation, amortization, & other noncash items Stock-based compensation expense Net recognized losses (gains) on investments & derivatives Excess tax benefits from stock-based compensation Deferred income taxes Deferral of unearned revenue Recognition of unearned revenue Accounts receivable Inventories Other current assets Other long-term assets Accounts payable Other current liabilities Other long-term liabilities Net cash flows from operating activities Net proceeds from short-term debt Short-term borrowing (repayments), maturities of 90 days or less, net Proceeds from issuance of debt, maturities longer than 90 days Repayments of debt, maturities longer than 90 days Common stock issued Common stock repurchased Common stock cash dividends paid Excess tax benefits from stock-based compensation Other financing activities Net cash flows from financing activities Additions to property & equipment Acquisitions of companies, net of cash acquired Purchases of investments Maturities of investments Sales of investments Securities lending payable Net cash flows from investing activities Effect of exchange rates on cash & cash equivalents Net change in cash & cash equivalents

02/20/2011

12/31/2010 2nd Quarter USD Unaudited Yes Thousands 6,634,000 663,000

09/30/2010 1st Quarter USD Unaudited Yes Thousands 5,410,000 694,000

03/31/2010 3rd Quarter USD Unaudited Yes Thousands 4,006,000 694,000

12/31/2009 2nd Quarter USD Unaudited Yes Thousands 6,662,000 615,000

09/30/2009 1st Quarter USD Unaudited Yes Thousands 3,574,000 646,000

553,000 (226,000)

528,000 (29,000)

481,000 (68,000)

485,000 (188,000)

443,000 (66,000)

(4,000)

(5,000)

(14,000)

(15,000)

(9,000)

(117,000) 6,834,000 (7,301,000) (3,270,000) 380,000 (77,000) 118,000 216,000 (500,000) 283,000 4,186,000 (1,000,000)

(148,000) 5,881,000 (6,862,000) 3,674,000 (468,000) 208,000 62,000 (400,000) (911,000) 560,000 8,194,000 814,000

(241,000) 6,087,000 (6,395,000) 1,947,000 (284,000) (81,000) 897,000 364,000 7,393,000 (349,000)

550,000 6,926,000 (9,126,000) (2,789,000) 1,244,000 16,000 285,000 304,000 4,969,000 (475,000)

(46,000) 6,679,000 (6,237,000) 2,748,000 (654,000) (78,000) (1,239,000) 346,000 6,107,000 378,000 (823,000)

-

4,721,000

851,000

1,046,000

695,000

-

(814,000)

(502,000)

(573,000)

-

660,000 (5,052,000) (1,363,000) 4,000

177,000 (4,399,000) (1,118,000) 5,000

422,000 (2,023,000) (1,139,000) 14,000

729,000 (3,867,000) (1,152,000) 15,000

248,000 (1,540,000) (1,157,000) 9,000

(6,751,000) (491,000) (69,000)

(25,000) (639,000) (564,000) 0

(2,726,000) (408,000) (143,000)

(4,277,000) (376,000) (63,000)

(2,190,000) (435,000) (39,000)

(5,896,000) 1,836,000 2,603,000 447,000 (1,570,000) (3,000)

(7,417,000) 870,000 1,427,000 727,000 (4,957,000) 58,000

(11,217,000) 1,054,000 4,927,000 (117,000) (5,904,000) (30,000)

(4,287,000) 1,896,000 3,361,000 (623,000) (92,000) (1,000)

(10,490,000) 3,498,000 4,417,000 1,850,000 (1,199,000) 29,000

(4,138,000)

2,656,000

(1,267,000)

599,000

2,747,000

37

Mergent, Inc.

Microsoft Corporation Report Date Currency Audit Status Consolidated Scale Cash & cash equivalents, beginning of period Cash & cash equivalents, end of period Report Date Currency Audit Status Consolidated Scale Net income (loss) Depreciation, amortization, & other noncash items Stock-based compensation expense Net recognized losses (gains) on investments & derivatives Excess tax benefits from stock-based compensation Deferred income taxes Deferral of unearned revenue Recognition of unearned revenue Accounts receivable Inventories Other current assets Other long-term assets Accounts payable Other current liabilities Other long-term liabilities Net cash flows from operating activities Net proceeds from short-term debt Short-term borrowing (repayments), maturities of 90 days or less, net Proceeds from issuance of debt, maturities longer than 90 days Repayments of debt, maturities longer than 90 days Common stock issued Common stock repurchased Common stock cash dividends paid Excess tax benefits from stock-based compensation Other financing activities Net cash flows from financing activities Additions to property & equipment

02/20/2011

12/31/2010 2nd Quarter USD Unaudited Yes Thousands 8,161,000

09/30/2010 1st Quarter USD Unaudited Yes Thousands 5,505,000

03/31/2010 3rd Quarter USD Unaudited Yes Thousands 9,422,000

12/31/2009 2nd Quarter USD Unaudited Yes Thousands 8,823,000

09/30/2009 1st Quarter USD Unaudited Yes Thousands 6,076,000

4,023,000

8,161,000

8,155,000

9,422,000

8,823,000

03/31/2009 3rd Quarter USD Unaudited Yes Thousands 2,977,000 664,000

12/31/2008 2nd Quarter USD Unaudited Yes Thousands 4,174,000 632,000

09/30/2008 1st Quarter USD Unaudited Yes Thousands 4,373,000 585,000

432,000 507,000

417,000 139,000

443,000 36,000

(2,000)

(2,000)

(44,000)

(368,000) 5,899,000 (6,670,000) 1,697,000 106,000 26,000 114,000 662,000 6,044,000 (329,000)

454,000 5,969,000 (6,364,000) (1,647,000) 797,000 (69,000) 614,000 668,000 5,782,000 21,000 -

376,000 4,186,000 (6,044,000) 3,985,000 (558,000) (116,000) (4,552,000) 700,000 3,370,000 1,975,000 -

328,000

-

-

-

-

-

112,000 (18,000) (1,155,000) 2,000

96,000 (2,820,000) (1,157,000) 2,000

228,000 (6,493,000) (998,000) 44,000

(1,060,000) (632,000)

(3,858,000) (842,000)

(5,244,000) (778,000)

38

Mergent, Inc.

Microsoft Corporation Report Date Currency Audit Status Consolidated Scale Acquisitions of companies, net of cash acquired Purchases of investments Maturities of investments Sales of investments Securities lending payable Net cash flows from investing activities Effect of exchange rates on cash & cash equivalents Net change in cash & cash equivalents Cash & cash equivalents, beginning of period Cash & cash equivalents, end of period

03/31/2009 3rd Quarter USD Unaudited Yes Thousands -

12/31/2008 2nd Quarter USD Unaudited Yes Thousands (450,000)

09/30/2008 1st Quarter USD Unaudited Yes Thousands (377,000)

(10,683,000) 915,000 3,327,000 1,064,000 (6,009,000) (36,000)

(6,596,000) 290,000 5,700,000 (601,000) (2,499,000) (83,000)

(4,246,000) 464,000 7,075,000 (1,543,000) 595,000 (56,000)

(1,061,000)

(658,000)

(1,335,000)

8,346,000

9,004,000

10,339,000

7,285,000

8,346,000

9,004,000

2,3,5 yr Analysis - Income Statement Item Revenues Direct Costs Gross Profit Taxation Net Income EPS Continuing Basic EPS Net Basic EPS Continuing Diluted EPS Net Diluted

06/30/2010 USD 62,484,000,000 12,395,000,000 50,089,000,000 6,253,000,000 18,760,000,000 2.13 2.13 2.1 2.1

06/30/2009 USD 58,437,000,000 12,155,000,000 46,282,000,000 5,252,000,000 14,569,000,000 1.63 1.63 1.62 1.62

Item Revenues Direct Costs Gross Profit Taxation Net Income EPS Continuing Basic EPS Net Basic EPS Continuing Diluted EPS Net Diluted

06/30/2010 USD 16,039,000,000 3,170,000,000 12,869,000,000 1,506,000,000 4,518,000,000 0.52 0.52 0.51 0.51

Variance USD 3,914,000,000 1,663,000,000 2,251,000,000 357,000,000 2,116,000,000 0.26 0.26 0.26 0.26

Variance USD 4,047,000,000 240,000,000 3,807,000,000 1,001,000,000 4,191,000,000 0.50 0.50 0.48 0.48

% 24.40 52.46 17.49 23.71 46.83 50.00 50.00 50.98 50.98

% 6.93 1.97 8.23 19.06 28.77 30.67 30.67 29.63 29.63

12/31/2010 USD 19,953,000,000 4,833,000,000 15,120,000,000 1,863,000,000 6,634,000,000 0.78 0.78 0.77 0.77

Compound Annual Growth Rate 3 Year 0.01 0.02 0.01 0.01 0.02 0.04 0.04 0.04 0.04

5 Year 0.07 0.10 0.06 0.02 0.08 0.12 0.12 0.12 0.12

2,3,5 yr Analysis - Balance Sheet 06/30/2010

02/20/2011

06/30/2009

39

Variance

12/31/2010

Mergent, Inc.

Microsoft Corporation

Item Cash & Equivalents Receivables (ST) Inventories Current Assets Long Term Investments Net Property Plant & Equip Total Assets Accounts Payable Current Liabilities LT Debt & Leases Total Liabilities Total Equity

06/30/2010 USD 5,505,000,000 13,014,000,000 740,000,000 55,676,000,000 7,754,000,000 7,630,000,000 86,113,000,000 4,025,000,000 26,147,000,000 4,939,000,000 39,938,000,000 46,175,000,000

06/30/2009 USD 6,076,000,000 11,192,000,000 717,000,000 49,280,000,000 4,933,000,000 7,535,000,000 77,888,000,000 3,324,000,000 27,034,000,000 3,746,000,000 38,330,000,000 39,558,000,000

Variance USD (571,000,000) 1,822,000,000 23,000,000 6,396,000,000 2,821,000,000 95,000,000 8,225,000,000 701,000,000 (887,000,000) 1,193,000,000 1,608,000,000 6,617,000,000

Item Cash & Equivalents Receivables (ST) Inventories Current Assets Long Term Investments Net Property Plant & Equip Total Assets Accounts Payable Current Liabilities LT Debt & Leases Total Liabilities Total Equity

06/30/2010 USD 5,505,000,000 13,014,000,000 740,000,000 55,676,000,000 7,754,000,000 7,630,000,000 86,113,000,000 4,025,000,000 26,147,000,000 4,939,000,000 39,938,000,000 46,175,000,000

Variance USD (1,482,000,000) (140,000,000) 121,000,000 4,008,000,000 2,268,000,000 169,000,000 6,193,000,000 (162,000,000) (1,835,000,000) 4,732,000,000 3,887,000,000 2,306,000,000

% (26.92) (1.08) 16.35 7.20 29.25 2.21 7.19 (4.02) (7.02) 95.81 9.73 4.99

Item Cash & Equivalents Receivables (ST) Inventories Current Assets Long Term Investments Net Property Plant & Equip Total Assets Accounts Payable Current Liabilities LT Debt & Leases Total Liabilities Total Equity

5 Year (0.04) 0.07 (0.13) 0.03 (0.03) 0.20 0.04 0.07 0.03 0.06 0.03

% (9.40) 16.28 3.21 12.98 57.19 1.26 10.56 21.09 (3.28) 31.85 4.20 16.73

12/31/2010 USD 4,023,000,000 12,874,000,000 861,000,000 59,684,000,000 10,022,000,000 7,799,000,000 92,306,000,000 3,863,000,000 24,312,000,000 9,671,000,000 43,825,000,000 48,481,000,000

Compound Annual Growth Rate 3 Year (0.19) (0.01) (0.09) 0.09 0.06 0.07 0.06 0.00 (0.04) 0.03 0.08

2,3,5 yr Analysis - Ratio Analysis Item ROA % (Net) ROE % (Net)

02/20/2011

06/30/2010 USD 22.88 43.76

06/30/2009 USD 19.34 38.42

Variance USD % 3.54 18.30 5.34 13.90

40

12/31/2010 USD 28.63 55.16

06/30/2010 USD 21.19 39.44

Variance USD 7.44 15.72

Mergent, Inc.

Microsoft Corporation

Item ROI % (Operating) EBITDA Margin % Gross Margin % Quick Ratio Current Ratio Net Current Assets % TA LT Debt to Equity Total Debt to Equity Total Asset Turnover

Item ROA % (Net) ROE % (Net) ROI % (Operating) EBITDA Margin % Gross Margin % Quick Ratio Current Ratio Net Current Assets % TA LT Debt to Equity Total Debt to Equity Total Asset Turnover

06/30/2010 USD 49.47 41.8 80.16 0.71 2.13 34.29 0.11 0.13 0.76

% 35.11 39.86 22.15 10.94 (5.56) 15.02 11.75 81.82 53.85 14.67

06/30/2009 USD 49.92 35.62 79.2 0.64 1.82 28.56 0.09 0.15 0.78

Variance USD (0.45) 6.18 0.96 0.07 0.31 5.73 0.02 (0.02) (0.02)

12/31/2010 % USD (0.90) 55.97 17.35 45.24 1.21 75.78 10.94 0.7 17.03 2.45 20.06 38.32 22.22 0.2 (13.33) 0.2 (2.56) 0.86

Compound Annual Growth Rate 3 Year (0.04) (0.06) (0.09) 0.01 0.00 (0.04) 0.14 0.23 (0.05)

06/30/2010 USD 45.82 40.78 80.24 2.13 34.29 0.11 0.13 0.75

Variance USD 10.15 4.46 (4.46) 0.32 4.03 0.09 0.07 0.11

5 Year 0.05 0.09 0.06 (0.01) (0.01) 0.00 0.00 (0.02) 0.04

3 yr Business Analysis Report Date Currency Scale Client Windows & Windows Live Division Server & Tools Online Services Business Microsoft Business Division Entertainment & Devices Division Total

Revenues 06/30/2010 USD Thousands 17,788,000 14,878,000 2,198,000 18,909,000 8,114,000 61,887,000

Report Date Currency Scale Client Windows & Windows Live Division Server & Tools Online Services Business Microsoft Business Division Entertainment & Devices Division Total

06/30/2008 USD Thousands 12,537,000 4,261,000 (1,309,000) 12,182,000 267,000 27,938,000

02/20/2011

06/30/2009 USD Thousands 14,414,000 14,135,000 3,088,000 18,902,000 7,753,000 58,292,000

41

06/30/2008 USD Thousands 16,472,000 13,189,000 3,214,000 18,937,000 8,139,000 59,951,000

Operating Income 06/30/2010 USD Thousands 12,089,000 4,990,000 (2,436,000) 11,664,000 589,000 26,896,000

06/30/2009 USD Thousands 10,435,000 5,047,000 (2,391,000) 11,940,000 5,000 25,036,000

Mergent, Inc.