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Microsoft Earnings Meet Forecasts; Revenue Beats
CNBC.com | October 20, 2011 | 05:10 PM EDT

Microsoftposted earnings that met expectations and revenue thattopped modest Wall Street forecasts, buoyed by strong sales of its popular Office applications package.

The software giant reported that its earnings, excluding items, were 68 cents per share, an increasefrom 62 cents a year ago.

Net income rose 6.1 percent to $5.74 billion from $5.41 billion at the same time last year.

Revenue increased 7 percent to $17.37 billion from $16.2 billion in the year-earlier period helped by its Office product, which remains popular with businesses even in the difficult global economy.

Analysts had expected Microsoft to report earnings of 68 cents per share on revenue of $17.24 billion, according to a consensus estimate from Thomson Reuters.

It is the first time in 10 quarters that Microsoft has not exceeded the average estimate for earnings per share.

Windows sales edged up only 2 percent, in line with limp personal computer sales last quarter, breaking the streak of three straight quarters of declining sales, as compared to the year before. But it fell short of some analysts' hopes.

"We still had Windows miss again, although not by nearly as much as it has the last couple quarters," said Brendan Barnicle, an analyst at Pacific Crest Securities.

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