Microsoft upbeat as profits almost double

PROFITS at computer giant Microsoft have almost doubled as sales of personal computers, Xbox games console and server software remained strong, the company announced last night.

The world's largest software maker reported third-quarter net profits of $2.56bn (£1.34bn) to 31 March 2005 up from $1.32bn (£695m) a year ago.

But in spite of netting around £55m a day in sales revenue, the figure fell short of analysts' and the company's expectations. Revenue rose slightly to $9.62bn (£ 5.1bn) from $9.18bn (£ 4.83bn) against a forecast $9.8bn (£ 5.16bn).

However, the company remains upbeat about future sales, which it said would be supported by a 'strong product pipeline'.

Its next-generation Xbox is due to be released next month and a major upgrade to its Windows operating system, code-named Longhorn, is planned for next year.

'The outlook for 2006 is better than we expected,' said Brendan Barnicle, an analyst at Pacific Crest Securities. {3}The forecast offset the impact of slightly disappointing revenue in the quarter, he said.

Microsoft has been struggling with a European anti-trust probe and sales growth at a five-year low. Chief executive Steve Ballmer met EU Competition Commissioner Nellie Kroes earlier this week to discuss the monopoly investigation.