Among the factors driving Microsoft's record revenues and earnings per share was the 55% growth in revenue for the Entertainment & Devices Division, as the success of the Kinect sensor boosted sales of Xbox 360 consoles, Xbox Live subscriptions and Xbox games.
Microsoft Business Division revenue grew 24% year-over-year. Office 2010 is the fastest-selling consumer version of Office in history, with license sales over 50% ahead of Office 2007 over an equivalent period following launch.
Microsoft also announced it has now sold over 300 million Windows 7 licenses, and Windows 7 is now running on over 20% of internet-connected PCs.
Despite the better-than-expected profit, Microsoft's shares stayed flat as investors expressed concern about the weakness of overall computer sales amid a faltering U.S. recovery.
Microsoft is heavily dependent on PC sales, which grew only 3 percent in the quarter. Now it is starting to feel the heat from investors eyeing the phenomenal take-up of Apple iPad.