Kinect and Office boost Microsoft as Windows sales fall

Flat financials show strength in breadth

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Buoyant sales of the hugely successful Kinect for Xbox 360 and Office were enough to keep Microsoft's last quarter financials looking healthy, despite the expected drop off in Windows sales.

With PC sales suffering as tablets and consoles rose in the traditionally busy holiday season, analysts has pointed to a likely major drop for Microsoft income.

However, although net income did drop, it was only from $6.63 billion to $6.6 billion – and the results were enough to push the software giant's share price up slightly.

Windows sales suffered – with a 30 per cent reduction year on year; not surprising considering its launch date.

Kinect growth

However, 8 million Kinect's sold 'far exceeded Microsoft expectations' and Microosft's Buseinss Division grew 24 per cent year on year on the back of Office sales.

"We are enthusiastic about the consumer response to our holiday lineup of products, including the launch of Kinect. The 8 million units of Kinect sensors sold in just 60 days far exceeded our expectations," said Peter Klein, chief financial officer at Microsoft.

"The pace of business spending, combined with strong consumer demand, led to another quarter of operating margin expansion and solid earnings per share growth."