Microsoft has reported revenues of $24.52bn and net income of $6.56bn for the financial quarter ending 31 December 2013, up 14% and 2.8% respectively compared with the same period the year before.
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In response to the better-than-expected results, Microsoft’s shares rose nearly 4% in after-hours trading, according to the BBC.
The results were boosted by sales of the new Xbox game console and Surface tablets in December 2013 and strong business demand for cloud services.
Outgoing Microsoft chief Steve Ballmer attributed the results to firm’s investments in devices and services, which he announced last year to counter competition from Google and Apple.
Consumer sales were up 13% compared with the year before and sales of Microsoft's cloud products, such as Office 365 and Azure, more than doubled.
However, A decline in PC sales continues to hit Microsoft’s Windows business, with OEM revenue for Windows declining by 3%, the company said.
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“We delivered record revenue as demand for our business offerings remains high and we made strong progress in our Devices and Consumer segment,” said Amy Hood, chief financial officer at Microsoft.
“These results reflect our focus on execution, cost discipline, and long-term shareholder value as we continue to drive the strategic transformation of the company.”
While some analysts question the wisdom Microsoft's move into manufacturing hardware, Surface tablets seem to be gaining traction.
Microsoft still will not reveal specific unit sales numbers, but said it generated $893m in revenues from Surface tablet sales in the quarter, compared with $400m in the previous quarter.