Yahoo reported slightly better than expected 1st quarter results on Tuesday, but failed to deliver the blowout quarter that many analysts said it needed to get a higher takeover offer from Microsoft.

Yahoo we down $.19 cents in after hours trading following the report, as the results are seen as not being strong enough for Yahoo to increase its leverage against Microsoft.

Strong results were considered to be Yahoo’s best chance to make its case to shareholders that it should remain independent, or that Microsoft’s offer was too low.

For the quarter ended March 31, Yahoo said net income rose to $542 million, or 37 cents a share, from $142 million, or 10 cents a share in the same period a year earlier. The recent period’s earnings included a gain of $401 million related to the IPO of Chinese Internet company Alibaba.com, in which Yahoo has an ownership stake.

Revenue rose 8.7% to $1.82 billion from $1.67 billion.

Not including special items, Yahoo said earnings were 11 cents a share. Yahoo’s net revenue, which doesn’t include traffic acquisition payments to other Web sites, rose to $1.35 billion.

Yahoo said it expects revenue between $1.73 billion and $1.93 billion in the second quarter and between $7.2 billion to $8 billion for the year.

Microsoft’s Chief Executive Steve Ballmer suggested that Yahoo upcoming earnings report won’t change the tech giant’s current bid for Yahoo.

Ballmer indicated that Microsoft will stand by its offer to buy Yahoo for $31 a share even if the Internet company’s results impress or disappoint Wall Street, according to a Reuters report.

“We think we can accelerate our strategy by buying Yahoo and will pay what makes sense for our shareholders,” Ballmer was quoted as saying during the launch of Microsoft’s Web portal for North Africa. “I wish Yahoo all the success with its results but it doesn’t affect the value of Yahoo to Microsoft.