Reporting its strongest fiscal Q1 for seven years, Microsoft yesterday declared that for the quarter ended September 30 it had revenue of $13.76BN compared to just $10.81BN a year ago, with a whopping 23% increase in net income ($4.29BN compared to $3.48BN a year ago). Looking ahead to the holiday sales season, Microsoft said it expects to report revenue in the range of $15.6-$16.1BN for its second fiscal quarter, which ends December 31. Stock soared by more than 10% yesterday on the Nasdaq as a result.

The company's various divisions all contributed to the success: sales of the client division grew sales were up 25%; its business division, was up 20%; the server and tools unit grew 16%; and the "Halo 3" effect on the entertainment and devices group saw sales surge 91%.

"The first quarter represented an outstanding start to the fiscal year with every part of the company performing at or above expectations," said Chris Liddell, Microsoft's CFO, in the traditional earnings call with analysts after the Q1 results were made public.

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