Seattle Microsoft Corp. on Thursday said quarterly profit rose 24 per cent on robust sales of Windows but tempered expectations of a sales spike when its Xbox 360 video game console launches in a month.
Microsoft?s shares fell 1.5 per cent in after-hours trading after it set a current-quarter revenue target below Wall Street expectations.
Microsoft will debut Xbox 360 November 22, the first of a number of key product launches over the next year.
Microsoft?s Chief Financial Officer Chris Liddell said that the company aimed for more of a ?gradual ramp? of Xbox sales to avoid running out of machines early after the launch.
The analysts were expecting more of a launch spike than we were.
"For Xbox 360 we've taken a deliberate approach rather than having supply dry up early," Liddell said.
Strong sales of personal computers, which Liddell saw rising 9 per cent to 11 per cent in the year to June 2006, drove results in the September-ending fiscal first quarter.
Net income reached $3.14 billion, or 29 cents per share, compared with $2.53 billion, or 23 cents per share, a year earlier, which included a 3 cent charge for a settlement with Novell Inc.
Excluding a legal settlement charge with RealNetworks Inc, Microsoft earned 31 cents per share in the first fiscal quarter, topping analysts' average expectations by a penny.
Revenue rose 6 per cent to $9.74 billion from $9.19 billion, just behind Wall Street expectations.
"We hoped to see a little more upside," said Brendan Barnicle, an analyst at Pacific Crest Securities.
Microsoft said it was on track to ship between 4.5 and 5.5 million Xbox 360 consoles the fiscal year to June 2006.
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