Microsoft (MSFT) Stock Spike on Earnings, CEO Nadella Touts Cloud Success

Microsoft also reported that revenues from More Personal Computing declined 5pc to $12.7bn. Sales of the Web-based Office 365 productivity quite climbed nearly 70 percent, using a similar currency adjustment. It sub-headlines the results with a line commenting upon “cloud strength”, and the Microsoft Cloud was indeed a top performer for the company, actually it was the only one of Microsoft’s three business segments to enjoy overall growth (ignoring non GAAP constant currency figures). In short, Microsoft has found some firm footing in the competitive cloud computing market.

Microsoft’s results come as the cloud services market is expected to hit $27.4 billion (£19bn) in 2016, according to Synergy Research Group.

The last quarter saw the release of new Microsoft-made flagship Windows 10 Mobile phones, the Lumia 950 and 950XL, however both failed to build excitement about the platform, despite powerful hardware features.

Microsoft’s net income fell to $5bn, or 62c per share in its second-quarter ended December 31, from $5.86bn, or 71c per share, a year earlier.

Microsoft CEO Satya Nadella argued that the numbers of businesses that are piloting Windows 10 leads it to expect that it will be installed on over 200 million active devices in the coming year.

During the previous quarter, Ms. Hood revealed that Bing contributed more than $1 billion for the quarter. The service revenue from the Intelligent Cloud (IC), grew from $5.9 billion to $6.4 billion over the same period.

Since he took over Nadella has seen Redmond’s shares climb more than 26 percent even as the broader market has dropped five percent.

The revenue Microsoft generated from their cloud business, including the Azure platform used by many businesses for storage and collaboration, was up by 5% to 6.3 billion dollars (£4.3bn), while Azure revenue alone was up by 140%. Meanwhile, Microsoft reported that its success in monetizing its search advertising had grown by 29%, which it attributed to the integration of search into Windows 10.

Xbox Live monthly active users grew 30pc year-over-year to a record 48m users. Windows Continuum, which allows its mobile phones to be connected to a monitor for a PC experience powered by Windows 10, is one of the features the company is banking on.