Microsoftreported a profit and sales that improved over last year and both topped what Wall Street was looking for, helped by strong sales of Windows 7.
Getty Images
Microsoft
Strong sales of the software, particularly to Microsoft's corporate customers, helped boost results in the fiscal fourth quarter. Microsoft said it has sold more than 175 million licenses of the newest version, Windows 7, since it went on sale last year.
Big businesses stopped replacing aging computers, servers and software during the worst of the recession. Last quarter, the software maker said it saw signs that its corporate customers were starting to spend again.
This quarter's results, which follow a strong report from chipmaker Intel, show the trend has continued. Microsoft Chief Financial Officer Peter Klein said billings for its multiyear agreements with big companies increased in the quarter.
The software giant earned 51 cents a share in its fiscal fourth quarter ended June 10, a 48 percent increase over a year earlier, when Microsoft reported a profit of 36 cents a share.
The company said its revenue for the quarter grew to $16.04 billion, against $13.099 billion a year earlier.
Analysts who follow Microsoft had expected more modest earnings and sales growth. A consensus estimate from Thomson Reuters put Microsoft's per-share profit at 46 cents and its sales at $15.26 billion.
"It looks really good," said Jefferies & Co analyst Katherine Egbert. "There's not a lot not to like. It's good all around."
Revenue for the group that makes Windows increased 44 percent to $4.5 billion, more than a quarter of Microsoft's total. The division that makes Office 2010 and other business software saw revenue rise 15 percent to $5.3 billion.
Microsoft's server software group reported a 14 percent increase in revenue to $4 billion.
Klein said Microsoft's currency-hedging program protected it from the effects of a stronger U.S. dollar. Otherwise, sales made in foreign currencies would have translated into fewer U.S. dollars.
Shares of the company hovered close to the flatline in extended trading Thursday after the results were reported. Get after-hour quotes for Microsoft here.
The stock got a pop during the regular Nasdaq session , rising almost 3 percent on heavy trading volume. U.S. shares were broadly higherThursday.