Turns out that selling tons of Xbox 360's for a loss, and hiring lots of new Windows Live (er, MSN) employees, while doing something else that'll increase costs in the future (our execs just gave guidance, but didn't explain why they think expenses are going up), means that we miss earnings estimates.

Joe Wilcox at Microsoft Monitor has the most complete analysis of our fiscal 2006 Q3 results. The market doesn't like these results and is pounding our stock lower by around 6% in after market trading.

CNBC is reporting "Microsoft slammed on earnings report." More on Memeorandum.

The market is a mean and unforgiving place. Our profits are up 13%, but our stock is down. It all comes to expectations and stockholders don't like the increased expectations on the cost side of the balance sheet.

On the other hand, Xbox sales are higher than expected, and that will turn into profits in future years (the more games, and other things, sold on each Xbox brings in money that counteracts the money we're losing on each one sold).

As a blogger who works for a company, and is also a shareholder, I'm always wondering just what I should say about such events?

I know that talking about financials is about the biggest risk there is for those of us who live our lives in the public eye. I know people who've been fired from other companies for doing just that.

So, I'm just going to lay it out there and play it straight.

What would you like employees to tell you in situations like this?

Stefan Constantienescu has been a reader of my blog for a long time (and hangs out on Channel 9). When he told me about his plans for buying a new computer that he couldn't afford, I wanted to hold off on posting it and see if he could make something happen on his own.

He did. He raised $1,000.

Let's go further and get him a MacBook. That costs $2,000 plus taxes (I might be able to get him an employee discount via my brother-in-law which would help). I'll throw in a copy of Windows XP so he can switch back and forth every day (his whole schtick was "make me switch"). 🙂

Personal note to Tara Hunt: you don't exist. 🙂

Oh, sorry, for everyone else, I'm just having some fun with Tara. She notes that big companies like Microsoft are gonna have a tough time getting it.

Totally agreed.

But, we have our secret weapons: Technorati and Bloglines and Feedster and NewsGator and IceRocket and other blog search engines.

They let us listen like a small startup.

The problem is, even when we hear, it takes a lot of convincing internally.

But, even there, we have another secret weapon: internal blogs. Email mailing lists. Lunch meetings. And social pressure.

Tara applies the social pressure. Which is why she's not invisible.

She's also onto something.

Big companies don't get small things. I was talking about that with a bunch of MBA students last night. The average billionaire executive doesn't understand why you'd speak to 100 MBA students. After all, Bill Gates could buy a full page ad in the New York Times and not notice the money missing from his account, right?

But, that's why my email is on my blog. Why my cell phone is on my blog (it's down at the right, and, yes, I do answer it, if I'm not in an interview or something like that).

By the way, I deleted all my feeds and am starting over. Tara's one of the first I added back in.