It's not often I do a double-take when I read a financial earnings report, but I had to make sure I was looking at Microsoft's

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[MSFT  Loading...      ()   ] numbers and not some other company's. The company beats by 6 cents a share; 45 cents instead of the 39 cents the Street was expecting. That performance on a big pop in revenue: $13.76 billion against the $12.57 billion analysts projected.

And guidance was also particularly strong, not just for the company's second fiscal quarter, but indeed all of fiscal 2008. Microsoft now looking for a new EPS range of 44 cents to 46 cents; the Street was looking for 44 cents.

Also, as far as the topline is concerned, analysts were expecting $15.6 billion. That's the new bottom of the $15.6 billion to $16.1 billion the company now expects. These are blockbuster, any which way you look at them.

Why such a phenomenal report? Pick a sector, and Microsoft beat. Pick a metric, and Microsoft excelled. The company's downtrodden Entertainment and Device Division, home of the Xbox, blew away expectations. The consensus was around $1.4 billion; Microsoft beats by a half-billion dollars. I mean, we knew Xbox was doing well, thanks to big sales from Halo 3, but this big? Wow!

Check out Client Software and Business Services. Both hit $4.1 billion when the Street was at $3.83 billion and $3.9 billion respectively. The Web Services Group was supposed to see a nice increase, but this much? Web Services, the new home of aQuantive, posting $671 million instead of the $618 million that was expected. Deferred revenue? $11.6 billion. Analysts expected $11.5 billion.

"It's definitely a big surprise," Piper's Michael Olson just told me. "The key going forward: We had a big foundation in '07 with Office and Vista. This year is the deployment year, and they'll provide building blocks for other products. In addition to all that, they're starting to get some traction in the online business, and even though it might be costing them an arm and a leg to do it, at least they're starting to make an imprint. Things are coming together for them."

Olson maintains his "buy" rating on the stock, which is noteworthy. Microsoft shares on this news quickly scampered 12% or better, adding a staggering $35 billion in market cap in just a blink of an eye. And to Olson, and likely others on the Street, those shares might be a good deal even at these levels.

Get ready for yet another Wall Street upgrade parade.

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