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April 22, 2012

Microsoft reveals $5.1bn profits for Q1

Shares in Microsoft jumped in extended trading after the latest profits from the world's biggest software maker beat Wall Street's expectations.


Although the company's $5.1bn (£3.2bn) of profit for the first three months of the year was slightly down on the same quarter in 2011, they beat expectations. Microsoft's $17.4bn of revenue was also stronger than forecast.

Along with Oracle and IBM, Microsoft is regarded as a bellwether for technology spending by the world's biggest corporations. Revenues at its business division rose almost 10pc to $5.98bn in the quarter.

Sales of its Windows operating system, which still powers the majority of computers, climbed 4pc.

"The Windows beat was a positive surprise, looking at about 4pc growth, versus expectations for about a 4pc decline," said Josh Olson, an analyst at Edward Jones.

Microsoft is betting that Windows 8, the next version of the operating system, will help it wrestle market share from Apple in the fast-growing tablet market.

The system will be compatible with far more of the tablets that are competitors to the iPad.

The software maker has not said when it will release Windows 8, but is is widely expected to be available in the autumn.

However, the quarter saw sales at Microsoft's entertainment division, which includes the Xbox videogame console, fall 16pc.

ales at its online services division, meanwhile, rose 6pc in a sign that its heavy investment in Bing, its rival to Google, may be reaping some benefit.

Having closed at $31.95 in normal trading in New York on Thursday, the shares climbed 3pc in extending trading.

telegraph.co.uk

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