Despite Xbox Setbacks, Microsoft Sees Profit Rise

Despite setting over $1 billion aside to pay for Xbox defaults, Microsoft Corp. saw a rise in both quarterly and yearly net profit. Fourth-quarter net profit was $3.04 billion, up from $2.83 billion in the same quarter last year. Revenues rose 13 percent to $13.4 billion. The company reported annual revenues of $51 billion, a 15 percent increase from the previous year’s $44 billion. Microsoft attributed strong earnings to sales of its Vista operating system, upgraded Office software, and its Xbox 360 console. “Our results this quarter cap off an extremely strong fiscal year for the company,” Chris Liddell, chief financial officer, said in a statement. Earlier this month, Microsoft said it would extend the warranty on the Xbox 360 to three years due to general hardware failures, or the “three-flashing-lights” error message. Though the company said it has fixed manufacturing problems, it did not give details.