Microsoft “beat virtually every metric” in first quarter
Microsoft’s first quarter sales “beat virtually every metric” as its cloud and Office businesses offset falling physical sales.
Revenues for the quarter jumped 14 per cent to $33.1 billion (£25.8 billion), alongside a net income rise of 21 per cent to $10.7 billion (£8.7 billion).
Its gaming business saw an overall decline of seven per cent, as its Xbox content and services remained largely flat from the same period last year.
Dwindling Xbox One sales have led the company to predict a further downturn of as much as 20 per cent in the coming quarter.
Microsoft’s Surface sales also dipped four per cent, citing the “timing of product lifecycle transitions” and the lack of any newly released products.
Overall its personal computing business raked in revenues of $11.1 billion (£8.65 million) during the quarter.
Despite these declines, Microsoft’s wider cloud and Office businesses achieved revenues of $11.1 billion (£8.65 billion) and $10.3 billion (£8.02 billion) respectively.
Office 365 saw revenues jump 13 per cent year-on-year, while its commercial subscriber base has grown 30 per cent to top 200 million.
Microsoft Azure saw revenues rise a whopping 59 per cent, while its wider server products also saw a 30 per cent rise.
The tech giant has “excellent visibility and line of sight into double-digit rev growth supported by multiple drivers and secular trends for the foreseeable future,” according to Jefferies’ Brent Thill.
Bloomberg analyst Anurag Rana added: “Microsoft is in a stronger position than cloud peers in the event of a pullback in IT spending.”
“No signs of a slowdown across its cloud or legacy offerings highlight Microsoft’s well-rounded portfolio and resilience in the face of a downturn.”