Microsoft grows solidly in Q3

Windows 7, Office 2010, SQL Server and Dynamics sales all strong, but entertainment revenues tank

The PC market's return to growth was underlined by buoyant results from Microsoft last night.

Microsoft's share price piled on 2.5 per cent after hours as the software giant unveiled a six per cent rise in revenue to $17.41bn (£10.8bn) for its fiscal third quarter ending 31 March.

The PC market defied expectations to grow modestly in the first calendar quarter of 2012, according to Gartner. This was reflected in a four per cent year-on-year rise in revenue at Microsoft's Windows and Windows Live division to $4.62bn during the period.

Some 40 per cent of enterprise desktops now run Windows 7, Microsoft revealed.

Fuelled by strong growth in SQL Server revenue, Microsoft's Server and Tools business swelled by 14 per cent to hit $4.57bn.

The Microsoft Business Division saw revenue rise nine per cent to $5.81bn, which Microsoft said reflected the strength of its Office 2010 business. Dynamics sales rose 11 per cent.

Only poor sales in the Entertainment and Devices Division – which saw revenue tumble 16 per cent – took the sheen off proceedings.

"We saw strong demand for our business desktop and infrastructure offerings," said Peter Klein, chief financial officer at Microsoft. "Solid revenue growth and continued cost discipline drove double-digit operating income growth."

Microsoft's share price hit a four-year high last month as anticipation builds around the upcoming launch of its tablet-friendly Windows 8 operating system (pictured).

Gartner expects 4.9 million Windows-based tablets to ship in 2012, despite expectations that the operating system will not be unveiled until Q4.