Microsoft Reports Fiscal 1Q Earnings Up 11 Percent

Microsoft Corp. said its fiscal first-quarter earnings rose 11 percent, beating analysts' expectations, as the software company benefited from stronger-than-expected computer and server shipments.

But shares in the company fell in after-hours trading Thursday as analysts expressed concern about the prospects for long-term corporate contracts.

For the three months ended Sept. 30, the Redmond, Wash.-based company reported earnings of $2.90 billion, or 27 cents per share, compared with earnings of $2.61 billion, or 24 cents per share, in the same period a year earlier.

The most recent quarterly earnings included a stock-based compensation expense of 5 cents per share. Without that, the company would have reported earnings of 32 cents per share.

Analysts polled by Thomson First Call had been expecting earnings of 30 cents per share, with estimates between 29 cents and 32 cents per share, on revenue of nearly $9 billion.