Microsoft earnings story updated with executive comment from the firm's conference call.
NEW YORK (TheStreet) -- Despite a 4% drop in year-over-year Windows 7 sales, Microsoft (MSFT) posted a solid beat of estimates for its fiscal third quarter, fueled by big Kinect for Xbox sales and the continuing rally in corporate IT business.
The one down point in the company's press release was soft Windows 7 sales, which reflect recent reports of falling consumer PC shipments. Issues likely impacting the consumer computer segment are supply chain disruptions in Japan, Window 7's maturity and slight cannibalization of margins due to tablet PCs.
The rest of Microsoft's core segments reported nice gains, with continued enterprise spending boosting its Business unit, which grew 21% year-over-year with sales of $5.2 billion, up from $4.3 billion. Microsoft said that its latest version of Office, Office 2010, continues to be the fastest-selling version in its history."We expect the business PC refresh cycle to continue through 2012," said Peter Klein, Microsoft's CFO, on the company's conference call Thursday after market close. "In terms of the PC market, we expect [growth in] emerging markets to outpace developed markets and growth in business PCs to outpace consumer PCs.
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