Microsoft Beats Earnings Expectations as Azure Growth Reaches 48%
Microsoft exceeds revenue and profit projections for its latest quarter while its Azure cloud platform posts impressive 48% growth. Despite the strong results, the company's stock remains flat in after-hours trading.
Microsoft reports $37.2 billion in revenue and $1.82 per-share profit for its fiscal first quarter, easily beating analyst expectations of $35.72 billion in revenue and $1.54 per-share earnings. Even with these better-than-expected results, the company's stock remains effectively flat in after-hours trading after gaining nearly 2% during the regular session.
The Intelligent Cloud segment leads Microsoft's performance with $13 billion in revenue, a 20% increase from the previous year. Azure drives this success with 48% revenue growth, a figure that surpasses the low-40s range anticipated by many investors. The Productivity and Business Processes unit brings in $12.3 billion, up 11%, while the More Personal Computing division generates $11.8 billion, a smaller 6% increase.
Several specific product categories show notable movement during the quarter. Surface revenue rises 37%, gaming revenue grows 22%, and LinkedIn gains 16%. In contrast, search advertising revenue falls 10%, and commercial Windows OEM revenue declines 22% despite a 31% boost in consumer Windows OEM revenue driven by elevated PC demand.