Microsoft has said it will create up to 5,000 new jobs and lift spending on research and development by 8% to about $7bn (�4.3bn) in its current financial year. The US software giant said 3,000-3,500 of the 4,000-5,000 new jobs would be in the US.
"Our deep and sustained investments in innovation are producing great results and we're accelerating them this year to provide customers with more cutting-edge technology and even better value," said chief executive Steve Ballmer.
The announcement came ahead of an annual analysts' meeting at the company's Redmond, Washington headquarters.
Earlier this month, Microsoft reported better than expected sales for the past quarter. Profits came in slightly below analyst forecasts.