The early bird catches the worm -- and the Microsoft (Nasdaq: MSFT) earnings report.

Enterprising souls found Microsoft's fiscal second-quarter report sitting on Mr. Softy's investor website more than an hour before the software giant intended to go public with the numbers.

The stock didn't exactly spike or tank on the early leak, and understandably so. Once again, Microsoft has announced another mixed quarter that should give bulls and bears plenty to debate.

First, the good news: Last year's debut of Office 2010 and the Kinect motion sensor for the Xbox 360 provided huge wins for Microsoft. The two well-received rollouts helped propel revenue 5% higher to nearly $20 billion -- a 15% spurt on an adjusted basis. Earnings per share climbed 4% to $0.77 a share, compared to the small dip analysts expected.

Now, the bad news: There's more to the bottom line than meets the eye. Microsoft spent $5 billion on buying back shares during the quarter, plus billions more throughout the year. That shrinking diluted share count created the per-share pop; without it, operating income and earnings actually declined slightly.

Microsoft's Windows division also suffered a 30% plunge in revenue. Wall Street expected a dip, since Microsoft was pitted against the prior year's debut of Windows 7, but this may serve as a cautionary tale for what Office 2010 may look like a year from now.

The server and tools division posted modest gains in revenue and operating income, but Microsoft's online arm posted a widening deficit.

Redmond's Bing search engine wasn't going to topple Google (Nasdaq: GOOG) overnight, but isn't it about time for Microsoft to turn a profit in cyberspace? Microsoft's online business only grew revenue by 19% year over year, which means it didn't even keep up with Big G on the top line over the past three months. Microsoft's deeper deficit isn't quite surprising, since the company pays Yahoo! (Nasdaq: YHOO) for the right to power its search results, but it should at least be keeping pace with Google's 26% top-line uptick for its latest quarter.

The silver lining in Microsoft's report is that analysts were looking for flat overall revenue growth and a dip in profitability. For outsiders eyeing Microsoft as a bellwether for the economy as a whole, it's heartening to see server and productivity software grow nicely.

Maybe one day we'll see Microsoft firing on all cylinders. For now, this will have to do.

What did you think about Microsoft's quarter? Share your tips in the comment box below.

Google and Microsoft are Motley Fool Inside Value recommendations. Google is a Motley Fool Rule Breakers pick. Yahoo! is a Motley Fool Global Gains choice. Motley Fool Options has recommended a diagonal call position on Microsoft. The Fool owns shares of Google, and Microsoft. Try any of our Foolish newsletter services free for 30 days.

Longtime Fool contributor Rick Munarriz admits to being one of Microsoft's vocal critics, though he was impressed with the company's quarter. He does not own shares in any of the stocks in this story. Rick is also part of the Rule Breakers newsletter research team, seeking out tomorrow's ultimate growth stocks a day early. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Fool has a disclosure policy.