Microsoft's gaming business is dependent primarily on its Xbox franchise but mobile devices have been eating into the gaming industry, luring consumers away from traditional consoles.
While the tech giant has released a few mobile games for iOS and Android like Wordament, "Age of Empires" is its most popular game to date to be offered beyond its own consoles.
The strategy is one that analysts argue other game machine makers such as Mario Brothers creator Nintendo Co Ltd could consider in a bid to leverage their software assets.
KLab will develop a mobile version of "Age of Empires" which will be released before the end of March, a KLab spokesperson said.
Shares in KLab were overwhelmed by a glut of buy orders in Tokyo trade on Tuesday, with its price indicated at 972 yen, 18 percent higher than its last close.
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