From:                     John Connors

Sent:                      Tuesday, July 18, 2000 11:24 PM

To:                         MS Corporate Employees: FTE Only; MS Domestic Employees: FTE Only; MS Intl Employees: FTE Only

Subject:                 Microsoft Announces Record Fiscal Year Revenue and Income

Today at 1:30 p.m. Pacific time, Microsoft released earnings for FY 2000.

Revenue was $22.96 billion for the fiscal year ended June 30, 2000, a 16 percent increase over the $19.75 billion reported last year. Net income totaled $9.42 billion. Diluted earnings per share were $1.70, a 20 percent increase compared to $1.42 in fiscal 1999.

You can view the complete text of the press release now at the Investor Relations Intranet site: http://finweb/finstock/
or at their Internet site: http://www.microsoft.com/msft/

The earnings conference call with financial analysts will take place from 2:30 - 3:30 p.m PDT today. 
The call will be Webcast live on CorpNet. You can listen at: http://winme/network/details.asp?EventId=7095
For those of you without CorpNet access, the call will also be Webcast from the Internet at: http://www.microsoft.com/msft/

A playback of the call will be available at both sites until end of business on Tuesday, July 25.

I also hope you will join me in an annual earnings chat this Thursday, July 20, from 12-1 p.m. PDT.   I will be answering your questions about year-end earnings as well as other finance-related topics. You can watch the live Webcast from your desk and submit questions during the show. To participate visit http://msw/execchat/

Thanks,

John Connors

Chief Financial Officer