Ascendant sales in Microsoft's Xbox division helped drive the company to record second-quarter revenues.
The Entertainment & Devices Division posted revenues of $4.24 billion for the three month period ending December 31, up 15 per cent year-on-year. However, operating income declined from $666 million to $528 million.
Microsoft sold 8.2 million Xbox 360 consoles in the quarter - a 25 per cent year-on-year increase - taking total worldwide sales to 66 million. Of that number, 40 million are now registered on Xbox Live, an increase of 33 per cent over the same point last year.
"This holiday season was the strongest in Microsoft history, thanks to good sales execution and compelling products like Xbox 360 and Kinect," said COO Kevin Turner in a call with investors.
"We continue to be very pleased with our share of the worldwide console market," added CFO Peter S. Klein. "However, the console market is softer than we previously expected, and as a result, we now expect revenue to grow high single-digits for the third quarter and mid-teens for the full fiscal year."
Microsoft posted sales of $20.89 billion across all divisions, up 5 per cent year-on-year. Net income for the quarter was $6.62 billion, a marginal drop for the previous year's total of $6.63 billion.
"We delivered solid financial results, even as we prepare for a launch year that will accelerate many of our key products and services," said CEO Steve Ballmer.
"Coming out of the Consumer Electronics Show, we're seeing very positive reviews for our new phones and PCs, and a strong response to our new Metro style design that will unify consumer experiences across our phones, PCs, tablets, and television in 2012."