SEATTLE – Strong demand for an alien-fighting video game and software for computer servers helped Microsoft Corp. beat Wall Street expectations as quarterly earnings more than doubled.
A decrease in stock-based compensation costs also helped.
Microsoft also reported its first profitable quarter in its home and entertainment division, fueled by strong sales for its Xbox Live online gaming service and the popular Halo 2 video game. The unit reported operating income of $84 million for the three-month period, compared with a loss of $397 million in the same period a year earlier.
But Chief Financial Officer John Connors warned that the home and entertainment division would lose money again in the first six months of 2005, and likely won’t achieve consistent profitability until late 2006 or early 2007.