Microsoft's shares drop after the quarterly report indicates that software subscriptions are much weaker than expected.

Microsoft delivered earnings report Thursday that beat estimates by 1 cent per share on better-than-expected revenue driven by strong consumer PC sales. Microsoft also said second-quarter and full-year results could come in higher than expected.

The company reported net income of $2.61 billion, or 24 cents a share, in the first quarter, compared with net income of $2.04 billion, or 19 cents a share in the same period a year earlier. Revenue rose 6.1% to $8.22 billion from $7.75 billion a year earlier and 1.9% from $8.07 billion in the previous quarter.

Despite higher than expected earnings, the stock drops on concerns about the longer-term underlying strength, one analyst said. The consumer side is making up for the enterprise right now. Until the company gets the commitment from its corporate users to subcript its destop products, the stock will be under pressured.

By: DocMemory
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