Microsoft delivered greater revenue for the quarter, owing to growth in its cloud-software business, with all three of its key business sectors reporting higher-than-expected results. Plus, the business expected continued strength in the December quarter.
Microsoft announced sales of $45.3 billion in its fiscal first quarter, up 22% from the previous quarter and above the Wall Street analyst forecast of $44 billion. Non-GAAP earnings per share were $2.27, 20 cents more than the Street forecast of $2.07.
The corporation earned $2.71 per share, including a $3.1 billion gain from a one-time tax advantage, according to generally accepted accounting rules, or GAAP.
These are just the numbers! What prompted this? Thoughts?
Many might wonder about the numbers behind the math…
Here’s the breakdown for the geeks
For the Productivity Business Processes – Office and other applications, the revenue was $15billion up by 22%! More than the investors expected! 18% growth in Office commercial products and a staggering 42% surge at LinkedIn and 31% growth in Microsoft Dynamics. Indeed SaaS.
Well, we are all aware of the cloud services that the tech giants offer and here’s Azure for Microsoft that posted revenue of $17billion, up 31%, Azure revenue was up by 50%. Many companies are moving to the cloud for their operations and Cloud services are on the rise. It seems to do a better job out there. Notably, Azure faces competition from AWS and Google Cloud.
But wait there’s more to the numbers Personal Computing segment which includes Windows, Surface, Xbox to name a few posted revenue of $13.3billion, again above what investors expected. Xbox sales were up by 166% for this quarter.
Well, there’s more to keep the investors happy! That’s the CFO of Microsoft projected strong numbers for the December quarter as well.
Does that prompt you to invest more??
Microsoft’s Earnings Call Highlights
Revenue was $51.7 billion and increased 20%
Operating income was $22.2 billion and increased 24%
Net income was $18.8 billion and increased 21%
Diluted earnings per share was $2.48 and increased 22%
Microsoft’s stock dropped over 6%, just days after reporting strong Q2’22 numbers. During the results call, however, the mood changed dramatically, and Microsft finished up over 4%, a 10% gain!
Microsoft’s projection for its cloud business piqued the interest of investors. Here are a few statements from the call that one should take note of:
Next Q: Azure Reaccelerating -
- “We anticipate sales of between $18.75 billion and $19 billion for Intelligent Cloud…
We estimate revenue growth in Azure to be up sequentially in constant currency, led by our Azure consumption business, which has seen considerable growth from a low base.”
PCs and Windows are making a comeback:
- "Now, on to Windows. We’ve seen a structural shift in PC demand. More than ever, people are turning to PCs to exercise their agency and unleash their creativity, whether it’s meeting in virtual reality or for remote work, writing code or collaborating in documents, live streaming video or playing games, or graphic design and engineering design.
- “With the announcement of our proposed acquisition of Activision Blizzard last week, we’re investing to make it easier for people to play great games wherever, whenever and however they want and also shape what comes next for gaming as platforms as the metaverse develop.”
- We also saw strong growth in LinkedIn Sales Solutions, which surpassed $1 billion in revenue over the past 12 months for the first time.
Insightful results to skim through!. In the computer world, I discovered that there is a burgeoning “PC renaissance.” I guess will Apple report anything along those lines?
Let’s see what Apple says. With their M1 chips, sales should be on fire!