Software giant records record revenue and better than expected earnings thanks to healthy Xbox 360 sales; stock gains on the news.
Microsoft reported a drop in profit for its fiscal second quarter Thursday, but sales and earnings beat analyst expectations thanks to strong sales of its Xbox 360 game console during the holidays.
The company reported record quarterly revenues of $12.54 billion, up 6 percent from a year ago and ahead of the $12.09 billion expected by analysts.
The stock rose about 1.9 percent in after-hours electronic trade.
"Revenue looked pretty good," said Rich Williams, analyst with ICAP. "We already knew Xbox sold well over the holidays, and we knew they lose money on every one sold, so that wasn't a huge plus. But the deferred revenue they reported was much higher than expected at $1.64 billion - very strong."
The Redmond, Washington-based software company reported earnings of 26 cents per share, compared to the 23 cents per share expected by analysts polled by Thomson Financial. A year ago, the company earned 34 cents per share in the second quarter.