Microsoft today announced fiscal Q1 2009 revenues of US$15.06 billion (ending September 30), a 9% increase year-on-year for the Redmond software giant that slightly surpassed Wall Street expectations. By operating segment, highlights include Microsoft’s Business Division providing the greatest share of revenue, posting nearly US$5 billion with operating income of US$3.3 billion. The Entertainment and Devices Division, including Microsoft’s line of Windows Mobile software, delivered US$1.8 billion in revenue and US$178 million profit. Online Services remained the black sheep of the company, announcing a loss of US$480 million off of US$770 million revenues, a loss nearly twice that of the year-ago period. Total company net income increased 2 percent to US$4.37 billion, from US$4.29 billion in the year-ago quarter. The company did, however, lower its outlook for the full fiscal year, to revenues of US$64.9-66.4 billion, from an earlier estimate of US$67.3-68.1 billion.

Microsoft is beginning to come under significant pressure in the smartphone-based Operating System arena from the likes of Apple and Google as well as Symbian, which is cementing plans to move to an open-source model. Indeed, after boldly proclaiming that it would sell 20 million licenses to its Windows Mobile operating system by the end of its fiscal year (June 30), the company this week conceded it did not hit its target, selling 18 million units in the fiscal year. Additionally, as a result of acquisitions in the mobile space aimed at building momentum, Microsoft’s Entertainment and Devices division recorded a US$145 million quarterly spend on R&D, a 46 percent quarter-on-quarter increase, “primarily reflecting increased headcount-related expenses associated with the Windows Mobile device platform.”