Microsoft calculated that number by taking the cloud unit’s best month in its fiscal first quarter ending September 30 and then multiplying it by 12. Overall, commercial Office revenue was up 10 percent, consumer 12 percent.
Demand for Office 365 has reportedly surpassed Microsoft’s expectations.
“The underlying momentum is pretty much in place, especially for the cloud effort”, said Sid Parakh, a fund manager at Becker Capital Management, which has US$3.8 billion in assets under management. “These were really strong growth rates”. Earnings per share was 84 cents versus an expected 72 cents, so it was a big win for the Seattle-based software giant.
Microsoft Corporation (NASDAQ:MSFT) posted its first-quarter results after the bell Thursday.
Microsoft predicts that it will bring in 83 cents per share in earnings for its current quarter on an adjusted basis.
(Microsoft won’t break out any of these product lines separately.) This quarter, Microsoft realized its billion annual run rate for its commercial cloud, a couple of months ahead of its original schedule, established two years ago. Operating expenses were $8.6 billion, an increase of 16% (15% in CC) over a year ago.
Customers increasingly are moving up the stack, from Azure infrastructure to “premium services” that rely on data-centric capabilities, like artificial intelligence and edge computing, Nadella said.
The Productivity and Business Processes unit also includes Microsoft’s Dynamics business, which sells software and services to help sales representatives manage customer relationships and finance departments manage corporate resources. Microsoft doesn’t break out revenue for its Windows business.
The number of commercial Office 365 subscriptions has now topped 120 million, as well. The segment declined earlier in 2017 owing to aging Surface Pro products that consumers shunned.
Microsoft states revenues from Surface hardware jumped 12% from a year ago – it follows a decrease the previous quarter. Both devices went on sale June 15.
And, the company said that LinkedIn contributed $1.1 billion in revenue during Q3. Intelligent cloud was up 14% at $6.9 billion, driven largely by a 90% jump in revenue for Azure, Microsoft’s cloud division, which competes with market leader Amazon Web Services. Analysts had estimated US$8 billion. The company could still drop some Xbox One X details in the conference call.