Typically, low- and mid-range phones drive sales, IDC said. But while high-end devices still make up a relatively small proportion of overall shipments, the category reported a big year-over-year leap. More than 55 million converged mobile devices shipped

Microsoft reported revenue of US$11.84 billion, a year-over-year gain of 9 percent that was just short of the $11.96 billion consensus revenue forecast from analysts polled by Thomson Financial. Last year for the same time period, Microsoft reported revenue of $10.82 billion.

Net income for the quarter increased 5 percent to $3.65 billion, or $0.34 per share. Excluding a tax benefit, pro forma earnings per share came in at $0.33, meeting the consensus estimate of analysts polled by Thomson Financial.

Microsoft attributed the growth to its core Server and Tools business, home to its Windows OS, which continued to do well in a strong PC market. The unit itself grew its revenue 14 percent year over year.

The availability of a host of highly anticipated products in the quarter, including the Xbox 360 game console, as well as SQL Server 2005, Visual Studio 2005 and Microsoft Dynamics CRM 3.0 software, also gave financials a boost, Microsoft said. SQL Server in particular experienced strong growth, with a revenue gain of 20 percent over the same time period last year.