Microsoft’s cloud unit saw significant growth, while Xbox reported its best non-holiday quarter for revenue.
Microsoft continues to report solid growth, with a quarter that exceeded analyst expectations in earnings and revenue.
The software giant’s revenue in its third fiscal quarter of the year stood at $49.4bn, an 18pc increase from the same quarter last year, while its earnings per share reached $2.22. These figures exceeded Refinitiv analyst expectations, CNBC reported.
Following the earnings report, Microsoft shares surged by around 6pc in extended trading yesterday (26 April).
Microsoft’s net income reached $16.7bn, a year-on-year increase of 8pc, while its operating income rose by 19pc to $20.4bn.
Similar to the previous quarter, Microsoft’s cloud revenue continues to see significant growth, increasing by 32pc to $23.4bn. This includes $19.1bn from Intelligent Cloud, its segment for public, private and hybrid server products and cloud services. Azure and other cloud services saw a 46pc year-on-year increase in revenue.
“Going forward, digital technology will be the key input that powers the world’s economic output,” Microsoft chair and CEO Satya Nadella said. “Across the tech stack, we are expanding our opportunity and taking share as we help customers differentiate, build resilience, and do more with less.”
LinkedIn revenue grew by 34pc, while Microsoft Office achieved around a 12pc increase in the same quarter that certain 365 subscriptions saw a price bump.
Microsoft’s gaming business experienced steady growth, with Xbox content and services revenue rising by 6pc. Xbox hardware revenue grew by 14pc and overall it has been reported as the best non-holiday quarter for Xbox revenue.
This was the same quarter when Microsoft announced its next big play in the gaming sector, with plans for a $69bn acquisition of Activision Blizzard.
The software giant has made notable moves in the gaming space in recent years. In March 2021, it got approval from the EU to acquire video game company Bethesda for $7.5bn, in what was its largest ever gaming deal.
The acquisition of Activision Blizzard now dwarfs that purchase and Microsoft’s previous biggest deal overall – its $26bn acquisition of LinkedIn in 2016.
Another growing segment for Microsoft is its cybersecurity business, which has seen revenue top $15bn a year.
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