Microsoft reported a 10 per cent fall in profits for the final quarter of 2014 compared to the same period last year mostly due to reorganisation expenses.
Figures released by the tech giant saw net income fall from $6.55bn in 2013 to $5.86bn, a 10.6 per cent drop, partly due to the integration and restructuring expenses worth $243m after purchasing Nokia’s phone business last year.
Despite financial analysts’ forecasts, Microsoft reported an 8 per cent revenue increase on the previous year amounting to $26.5bn.
The Seattle-based company saw “strong” sales of its Xbox game console over the Christmas period totalling 6.6 million units sold over the last three months.
Microsoft is hoping that Windows 10, its latest computer operating software (OS), will boost its software sales. Revenue from licensing the OS fell 13 per cent in the quarter compared to the previous year.
"Microsoft is continuing to transform, executing against our strategic priorities and extending our cloud leadership,” said Satya Nadella, Microsoft’s chief executive.
“We are taking bold steps forward across our business, and specifically with Windows 10, to deliver new experiences, new categories, and new opportunities to our customers."
Windows 10 brings the same operating system to smartphones, tablet computers and PCs as part of a new vision.