Microsoft shares dipped Friday after the software giant reported a fall in profits in quarterly earnings.

The company posted a net income of $6.38bn, or 76 cents per share, for the final three months last year - a 3.7% drop from a year earlier.

An adjusted non-generally accepted accounting principles diluted earnings per share of 81 cents was made during the quarter.

Analysts had forecast earnings excluding items of 75 cents a share on $21.53bn in revenue, according to a consensus estimate from Thomson Reuters.

Revenue rose 2.7% to $21.46bn, following the release of the new-generation Windows 8 software tailored for smartphones and tablet computers.

But the group demonstrated slow growth as it made little headway with the product used with touch-screen gadgets.

Microsoft's Windows division revenues climbed 24% during the quarter to $5.88bn but fell short of some analysts' forecasts and below the 70% jump the business experienced in the quarter after releasing Windows 7 in 2009.

"It's early days and an ambitious endeavour like this takes time," Microsoft Chief Financial Officer Peter Klein told press in regards to Windows 8.

Elsewhere, the server and tools business reported an 8.0% increase to $5.19bn year-on-year and the online services division was up 11% to $869m.

However the Microsoft Business division fell 10% to $5.69bn and the entertainment and devices division - which includes the Xbox videogame machines - decreased 11% to 3.77bn.

The company expects an operating expense guidance of $30.3bn to $30.9bn for the fiscal year in 2013.

Shares were down 0.54% to $27.48 at 13:52 Friday.

RD

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