Microsoft 2011 Annual Report Download - page 22

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22
normal OEM inventory levels, and the mix of versions of Windows licensed, offset in part by PC market changes,
including stronger growth of emerging markets versus developed markets and of consumer PCs versus business
PCs. Fiscal year 2009 OEM revenue reflects a $273 million Windows 7 Deferral. This amount was subsequently
recognized in fiscal year 2010. Other revenue increased $970 million or 26% driven primarily by Windows 7 retail
sales.
Windows Division operating income increased as a result of increased revenue, offset in part by higher operating
expenses. Sales and marketing expenses increased $258 million or 11% reflecting increased advertising and
marketing of Windows 7. Cost of revenue increased $251 million or 14%, primarily driven by traffic acquisition
costs and royalties.
Server and Tools
(In millions, except percentages) 2011 2010 2009
Percentage
Change 2011
Versus 2010
Percentage
Change 2010
Versus 2009
Revenue $ 17,096 $ 15,378 $ 14,601 11% 5%
Operating income $ 6,608
$ 5,539 $ 4,816 19% 15%
Server and Tools develops and markets technology and related services that enable information technology
professionals and their systems to be more productive and efficient. Server and Tools product and service
offerings include Windows Server, Microsoft SQL Server, Windows Azure, Visual Studio, System Center
products, Windows Embedded device platforms, and Enterprise Services. Enterprise Services comprise Premier
product support services and Microsoft Consulting Services. We also offer developer tools, training and
certification. Approximately 50% of Server and Tools revenue comes primarily from multi-year volume licensing
agreements, approximately 30% is purchased through transactional volume licensing programs, retail packaged
product and licenses sold to OEMs, and the remainder comes from Enterprise Services.