Citing improved results in Asia, Microsoft last night reported a 40 per cent increase in quarterly earnings to 35 cents per share, beating Wall Street estimates by three cents and up from 25 cents in the same period last year. Net earnings in the quarter that ended March 31st last came to $1.92 billion (€1.8 billion) from revenue of $4.33 billion (€4 billion), a 15 per cent increase over sales of $3.77 billion a year earlier.

The company said the sales figure did not include unearned revenue of $400 million, related to the Microsoft Office 2000 Technology Guarantee, and investment gains of more than $350 million during the quarter.

The company remains guarded about full-year growth because of consumer concern over the Y2K problem.