Microsoft's Earnings Surpass Expectations - NYTimes.com SEATTLE - Microsoft said Thursday that its quarterly revenue rose 6 percent on strong sales of its software to businesses, but the company showed weakness in video games and other newer areas of investment. In one of the most surprising developments, Microsoft said sales of its flagship software product, Windows, rose 4 percent in the fiscal third quarter, which ended on March 31. Analysts were expecting a drop in the business because of broader industry data showing weakness in the personal computer business. Microsoft reported a decline in net income to $5.11 billion, or 60 cents a share, compared with $5.23 billion, or 61 cents a share, in the same period a year ago. That decline was mainly due to a tax benefit of $461 million that Microsoft received last year, without which net income would have increased year over year. Revenue rose to $17.41 billion, from $16.43 billion a year ago. Analysts were on average expecting the company to report earnings of 58 cents a share and revenue of $17.18 billion, according to Thomson Reuters. "We're driving toward exciting launches across the entire company while delivering strong financial results," Steve Ballmer, Microsoft's chief executive, said in a statement. With the upcoming release of new Windows 8 PCs and tablets, the next version of Office, and a wide array of products and services for the enterprise and consumers, we will be delivering exceptional value to all our customers in the year ahead. While its core franchises, Windows and Office, continue to gush profits for the company, Microsoft is struggling to adapt itself to some of the deeper changes in the technology industry in recent years, especially the shift to mobile devices. Apple, Microsoft's longtime rival, has been the biggest beneficiary of that transition, with products like the iPhone and iPad. As a result, Apple now boasts a market value more than twice that of Microsoft. Microsoft is preparing to respond to the iPad with Windows 8, but an earlier effort to counter the iPhone has not yet borne the fruit the company intended. For more than a year, the company has been offering its Windows Phone operating system for smartphones, with little success. More recently, phones from the Finnish cellphone giant Nokia, including the Lumia 900, have hit the market with Windows Phone software to generally positive reviews. Microsoft does not reveal sales figures from its mobile phone software business, including them in the results of a larger division that also includes its Xbox video game business. That division saw sales drop 16 percent, to $1.62 billion, in the quarter because of a "soft gaming console market," Microsoft said in a statement. But in a sign of the difficulties Microsoft still faces, its most important partner in the mobile business, Nokia, said Thursday that sales of its new Lumia phones had been "mixed," with better results in the United States than in other markets like Britain.