Microsoft (Nasdaq: MSFT) is hanging in there.

The world's largest software company posted predictably bland quarterly results last night. Revenue inched 5% higher to nearly $20.9 billion, and operating profits and adjusted earnings inched marginally lower. However, aggressive share buybacks over the past year propped up earnings on a per-share basis to $0.78, just ahead of both the $0.77 it rang up a year earlier and the $0.76 that analysts were targeting.

There were no bombshells across Mr. Softy's five divisions. Its business division -- anchored by Office 2010 -- rose a modest 3%, while its server and tools software division came through with an 11% top-line spurt.

Windows watchers knew they'd be in for another soft quarter when sales tracker Gartner reported a 1.4% decline in global PC shipments during the fourth quarter. Unit leader and Microsoft cheerleader Hewlett-Packard (NYSE: HPQ) had seen a sharp 16% slide in global PC shipments.

Well, now that Microsoft gets a chance to tell its side of the PC story, we see that its Windows and Windows Live revenue fell 6% during the period. Operating profits fell even harder in the division, but this should improve when Windows 8 is released later this year.

Losses are narrowing at Microsoft's online division, though the company's 10% increase in revenue pales in comparison with the 25% top-line pop at niche leader Google (Nasdaq: GOOG) during the same three months.

That leaves us with Microsoft's Xbox business leading the way with a 15% revenue spurt. If someone would've told you a year ago that Xbox would be growing faster than Bing -- or a decade ago that a video game console would be outpacing operating-systems growth -- it would seem hard to believe.

Things should get less bland at this point. Nokia (NYSE: NOK) is finally starting to flood the market with Microsoft-fueled smartphones. The arrival of Windows 8 may or may not jump-start moribund PC sales, but it will give the software leader its best shot to date at mattering with tablets.

I've been covering Microsoft since the 1990s, and I've generally had a lukewarm opinion as an investor. However, I entered a bullish CAPScall on Microsoft in Motley Fool CAPS earlier this month, reversing my earlier bearish pick. This is the first year in a long time where Microsoft is setting itself up to make a statement, and it should be one worth making.

If you haven't read about the two words that are giving Bill Gates and Steve Ballmer fits, it's all in a free Motley Fool report,so you as may well check it out now.