Solid demand for Microsoft’s core products in the consumer and enterprise space pushed Microsoft’s revenue of the first fiscal quarter to $9.74 billion, up 6 percent from $9.20 billion for the same period in the previous year. Net income surged 26 percent from $2.53 billion to $3.14 billion in the same period - including a $361 million charge relating to a settlement with Real Networks.

Microsoft said that especially server products and tools contributed to overall growth. The segment posted double-digit revenue growth, led by SQL Server, which gained 15 percent. Continued adoption of the Windows Mobile operating system brought a 50 percent revenue increase for the Mobile and Embedded Devices group at Microsoft.

Chief financial officer Chris Liddell said that the company intends to accelerate its stock repurchase plan. Microsoft plans to spend $19 billion - or slightly more than the expected 2006 profit - on stocks until the end of December 2006.

For the holiday quarter, Microsoft estimates its revenues to come in between $11.9 billion to $12.0 billion ; profits are expected to land in the range of $4.6 billion to $4.7 billion.

While analysts generally considered Microsoft’s revenue and earnings as solid, the firm’s stock price fell in after hours trading on Thursday. The stock was traded at $24.40, down $0.71 or 1.8 percent from Wednesday’s close.