Microsoft cautious over profits forecast

Microsoft has cut profit forecasts for its current financial year despite reporting better than expected quarterly profits. The software company saw a 9% increase in revenue to £9.31bn for the three months to the end of September.

The rise led to a 2% increase in operating profits to £2.69bn, which it attributed to a good performance by its consumer-products and internet services business, despite a more difficult online advertising market. It also says that new product offerings in the software sector also pushed its revenue higher.

Microsoft is taking cautious approach to 2009 and reducing its spending in research and data centres as it expects the downturn to continue over the coming year.

The company claims that sales for its Xbox games console have exceeded expectations despite declining from the same period last year, which included the release of Halo 3.

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