people who are not yet realizing the benefits of technology. Unlimited Potential is focused on delivering relevant, accessible and affordable solutions that will help transform education, foster local innovation, and help create jobs and opportunities. We believe Microsoft can have the greatest impact in these three areas, creating a continuous cycle of sustained social and economic opportunity. 

During fiscal 2007, community technology skills centers supported by Unlimited Potential reached more than 46 million people. Through our Partners in Learning program, we have helped provide information and communications technology curriculum and skills training to more than 71 million primary and secondary teachers and students in 101 countries. 

 

At Microsoft, diversity and inclusion are also core values and we strive to be the industry leader in helping women and minorities realize their potential. Within the company, we promote diversity at every level of the organization, and in 2007, the number of women in senior executive positions increased more than 20 percent. We’re also working to encourage more women and minorities to enter the technology industry through programs such as DigiGirlz, which provides high school girls with opportunities to learn about careers in technology and take advantage of hands-on technology workshops. And we’re committed to working in partnership with minority- and women-focused organizations to help bring technology to diverse communities. One example is a $5 million technology grant to the National Urban League. 

 

A New Era of Innovation and Change 

 

Microsoft was founded with the dream of putting a computer on every desk and in every home, and for more than 30 years our software has played a vital role in the positive cycle of innovation and progress that has given rise to incredible new ways to communicate, share ideas, manage our businesses, and much more. 

 

It’s amazing to look back and see how much progress we have made in the past three decades. But it’s even more inspiring to look ahead and imagine a world where that dream embraces every country in every part of the globe, empowering billions more people to participate in the knowledge economy. As this happens, new ideas will emerge, new businesses will be launched, and important new advances will be made in science and medicine. The result will be a wave of new innovations that will continue to make our lives richer, more productive and more fulfilling. Because software is the foundation for the profound changes that lie ahead, Microsoft is in an ideal position to take advantage of the incredible opportunities that lie before us. 

 

It is your continued support that enables us to pursue these opportunities. Thank you. 





MANAGEMENT’S DISCUSSION AND ANALYSIS OF 

FINANCIAL CONDITION AND RESULTS OF OPERATIONS 

 

RESULTS OF OPERATIONS FOR FISCAL YEARS 2007, 2006, AND 2005 

 

OVERVIEW 

 

The following Management’s Discussion and Analysis (“MD&A”) is intended to help the reader understand the results of operations and financial condition of Microsoft Corporation. MD&A is provided as a supplement to, and should be read in conjunction