Microsoft reports better-than-expected profits

Microsoft last night reported quarterly earnings and revenues that edged past Wall Street expectations and said it would post…

Microsoft last night reported quarterly earnings and revenues that edged past Wall Street expectations and said it would post a slightly higher profit for the fiscal year than it had forecast.

But the world's largest software company also issued a cautious outlook for the coming fiscal year, saying it did not expect an economic rebound to drive a recovery in spending on computers and related software.

Microsoft reported a net profit of $2.79 billion (€2.58 billion), or 26 cents per share, for its fiscal third quarter ended March 31st - compared with $2.74 billion, or 25 cents per share, a year earlier. Analysts had forecast a profit of 24 cents per share.

Revenues rose to $7.84 billion from $7.25 billion a year earlier, compared with the $7.75 billion projected by analysts polled by Thomson First Call.

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Microsoft shares rose to $25.70 on the Instinet system in after-hours trade, up from a Nasdaq close of $24.61.

Microsoft said it now expects earnings of 97 cents or 98 cents per share on revenue between $31.9 billion and $32 billion for the current fiscal year. In January, Microsoft had said it expected earnings of 95 cents to about 96 cents on revenue between $31.9 billion and $32.1 billion.

But Microsoft forecast revenues for the next fiscal year ending in June 2004 would be between $33.1 billion and $33.8 billion, short of the average analyst forecast of $34.9 billion as tracked by Multex.

Microsoft employs about 1,600 staff in Dublin.