On its FQ3 earnings conference call on Thursday, Microsoft confirmed that it is working on smaller, cheaper Windows 8 tablets that are expected to arrive in coming months.

Seattle Times reporter Janet Tu paraphrased the comment as:

Microsoft CFO Peter Klein confirms company is working w/OEMs on smaller devices, at lower price points, to be available in coming months.

Earlier this month, talk of a 7-inch Surface tablet picked up, with The Wall Street Journal suggesting that the new line could go into production later this year.

Microsoft announced fiscal third quarter revenue of $20.49 billion, and earnings per share of $0.72. Also of note, Klein announced he will step down as CFO by the end of fiscal 2013. The company plans to promote a member of its financial leadership team in the next few weeks.

Bloomberg estimated in March that Microsoft had sold 1.5 million Surface tablets, 400,000 of which were the Windows 8-powered Surface Pro. While the number is believed to be below the company’s own expectations, it’s still enough to make its own tablet business a $1 billion segment.

Microsoft and its OEMs are likely feeling the pressure to ramp up their tablet business. PC shipments declined a shocking 13.9 percent year-over-year in the first quarter of 2013 , according to IDC’s estimates. The market research firm expects Windows to have just a 2.8 percent share of the tablet market by the end of this year, though that number is projected to grow to 7.4 percent by 2017.

Related: Here are Microsoft CEO Steve Ballmer and Peter Klein’s internal memos regarding the CFO’s exit

Image credit: TIMOTHY A. CLARY / AFP / Getty Images