NEW YORK (CNN/Money) - Microsoft Corp. Thursday reported a fiscal fourth-quarter profit that narrowly topped Wall Street forecasts as sales rose 10 percent from a year earlier, lifted in part by a shift in its licensing practices.

Executives of Microsoft also reined in their financial estimates for the current fiscal year but at the same time, they stood by their forecast for PC unit-shipment growth.

"We are planning on PC shipment growth in the low- to mid-single digits for fiscal 2003, consistent with what we told you last quarter," John Connors, Microsoft's chief financial officer, told analysts on a conference call Thursday evening.

"It does not appear to us that there has been any significant change, for better or for worse, in demand for PCs since our last earnings conference call," Connors said.

Although it has businesses in other areas, Microsoft's fortunes are tied closely to the PC industry, and the company's forecast for PC unit growth is closely watched by tech-industry observers. Some had expected the company to reduce its forecast in light of weakness reported recently by other industry players, including microprocessor maker Intel Corp. and Advanced Micro Devices Inc.

Earlier Thursday, Microsoft, which is the dominant supplier of computer operating systems with its various versions of Windows, reported fiscal fourth-quarter earnings of 43 cents per share, excluding charges.

That was a penny more than most analysts had expected, according to a survey conducted by First Call, and matched the operating earnings the company reported in the year-ago quarter.

Including an after-tax charge of $806 million stemming from investment losses, Microsoft's net income for the quarter was $1.53 billion, or 28 cents per share. That compares with $65 million, or a penny per share, in the same period a year ago, when the company recorded charges amounting to $2.63 billion.

At $7.25 billion, Microsoft's fourth-quarter revenue rose 10 percent from $6.58 billion in the same quarter last year and also topped analysts expectations of $7.1 billion, according to the First Call survey.

Part of the upside in fourth-quarter revenue is attributable to a new software licensing program Microsoft recently implemented with a July 31 deadline for customers interested in signing up for it.

Traditionally, software licenses were sold on an indefinite basis, with customers paying a one-time license fee and then paying again only when they needed to upgrade to the next version. The new licensing program is analogous to renting the software, where corporate customers effectively pay a subscription fee that entitles them to any and all upgrades as they become available.

A more notable line on Microsoft's latest income statement that rose as a result of the new licensing program is it "unearned revenue," which represents money the company has booked but not yet received.

Microsoft reported that it ended the fiscal year with unearned revenue balance of $11.1 billion, up 60.8 percent from fiscal 2001.

Shares of Microsoft (MSFT: Research, Estimates) fell 51 cents to $50.60 in extended-hours trade after falling 1.7 percent to $51.11 on Nasdaq ahead of the earnings report, which was released after the close of regular trading.

Even though they stood by the company's previous PC unit-growth forecast, executives slightly lowered their financial targets for the fiscal year ending next June.

For the fiscal year, Connors said Microsoft is aiming for revenue between $31.4 billion and $32 billion and earnings between $1.85 and $1.91 per share. In April, the company said it was targeting fiscal 2003 revenue ranging between $31.5 billion and $32.4 billion and earnings between $1.89 and $1.92 per share.

Connors said the company lowered the forecast for the full year after conducting its annual "bottoms up" planning exercise in fourth quarter, which includes detailed input from management across the company.

He attributed the lower financial expectations primarily to softer-than-expected investment income, which he now expects to come in at roughly $2 billion. Increased stock buybacks and expected declines in interest income are the cause of the shortage, Connors said.

For the fiscal first quarter, Microsoft is aiming for revenue ranging between $7 billion and $7.1 billion and earnings per share between 42 cents and 43 cents per share, which is generally in line with recent expectations.

Connors said robust demand for Microsoft's newest operating system software, Windows XP, as well as its desktop software, enabled the company to deliver strong operating results in the fourth quarter, in spite of the weakness that has dogged the broader information technology industry in recent months.

"While the current environment remains challenging, we're making important investments in product development, marketing and in our sales force that will position us for success in the current year and beyond," Connors said.

Microsoft plans to add 5,000 employees to its roughly 50,000 work force, with 30 percent to 40 percent of the new hires in the Puget Sound region. The positions are for research and development, sales and support, Connors said.

Microsoft logged revenue gains across all of its major business lines in the fourth quarter.

The company's desktop platforms business, which includes sales of its dominant Windows operating system software, logged $2.4 billion in sales, up from $2 billion a year ago.

Sales of desktop software, which includes Microsoft "Office" productivity programs such as Word, Excel and Powerpoint, rose to $4.9 billion from $4.5 billion.

Microsoft's consumer software, services and devices division -- a new product segment that includes its new Xbox video-game console, logged revenue of $822 million in the fiscal fourth-quarter, compared with $509 million in the year-ago quarter.

Microsoft introduced the Xbox last November as a competitive offering to Sony's Playstation 2 and Nintendo's GameCube. Microsoft said that sales of Xbox video game consoles reached 3.9 million for the fiscal year. It had been aiming to sell as many as 6 million.

For the full fiscal year, Microsoft reported a net profit of $7.83 billion, or $1.41 per share. That compares with $7.35 billion, or $1.32 per share, in fiscal 2001.

Microsoft's revenue in fiscal 2002 totaled $28.4 billion, up 12 percent from $25.3 billion the previous year.