Microsoft chairman Bill Gates

But the world's biggest software maker has warned of tough times ahead, amid a persistent slump in information technology spending.

Microsoft shares were sharply higher in after-hours trade on Wall Street, after a losing ground ahead of the results announcement.

Meanwhile, profits were down at chipmaker Intel, but were in line with cautious forecasts.

Cautious outlook

Microsoft reported a net profit of $2.79bn, or 26 cents per share, for the three months to 31 March, compared to $2.74bn, or 25 cents per share, a year earlier.

We're not planning to see a big uptick in demand of IT as a result of an economic rebound John Connors, Microsoft

Commenting on the results, Microsoft chief financial officer John Connors said: "We think it's is going to be a good year in an absolute and relative sense, but we're pretty cautious about the economic environment.

"We're not planning to see a big uptick in demand of IT as a result of an economic rebound."

Mr Connors said Microsoft was sticking to its single figure growth forecasts for PC sales for the year to the end of June, of "low to mid single digits".

Xbox targets

He said sales would grow in the following year in the "mid-single digits".

MSN, Microsoft's internet portal and subscription business, would see slower growth over the next three months, he added.

Mr Connors said there were no plans to change the target for 9 million shipments of Microsoft's Xbox video game console by the end of June.

"We feel very good about where we're at with the Xbox in the United States," he added.

Intel's net profit for the quarter was $915m, or 14 cents per share, compared with $936m a year earlier.

The chipmakers shares rallied in after-hours trading on the news.