Microsoft earnings above estimates

SAN FRANCISCO (Reuters) - Microsoft Corp (MSFT.O: Quote, Profile, Research, Stock Buzz) forecast on Thursday next year's earnings to rise between 13 percent and 18 percent, predicting continued strength from its main software businesses as it aims to bolster its Web unit with an acquisition of Yahoo Inc (YHOO.O: Quote, Profile, Research, Stock Buzz).

COMMENTARY:

KIM CAUGHEY, SENIOR ANALYST, FORT PITT CAPITAL GROUP

"It looks like they missed a little on the top line. I can't figure out where. Bottom line looks strong. It's nice that they're raising guidance for the rest of the year. Microsoft is an extremely conservative company with respect to guidance. That's always positive that they're raising guidance. It looks like the client (desktop software) was softer than the year ago period."

TOM TELFORD, VICE PRESIDENT AND PORTFOLIO MANAGER, AMERICAN CENTURY INVESTMENTS, KANSAS CITY. OWNS MICROSOFT IN AMERICAN CENTURY TECHNOLOGY FUND

"It looks like the operating income came in a little bit light versus the expectation. They had a lower tax rate and a lower share count. Revenues came in a little bit light. The main culprit there was the client business. The division that did really well was the entertainment business. The guidance for the quarter and next year was pretty positive."

ANDREW LOECHL, DIRECTOR, EAGLE HARBOR ASSET MANAGEMENT

"They were beating estimates by 3 cent which was not as high as the whisper number. Revenue was in line with estimates."

"There's nothing alarming but I'd like to see more detail on how Windows Vista, Office and their server business shaped up. I didn't see the detail on (the FY '09 forecast). It looked positive."