Microsoft reported its quarterly financial results on Wednesday after the U.S. close (Thursday AEDT), exceeding expectations amid robust performance in its Azure cloud division.
Earnings per share reached US$3.30, outperforming the projected $3.10, while revenues rose by 16% year-over-year to $65.59 billion (A$99.78 billion), surpassing the $64.51 billion consensus forecast.
For its fiscal second-quarter guidance, Microsoft projected revenue between $68.1 billion and $69.1 billion, suggesting approximately 10.6% growth.
Following the earnings release, Microsoft’s stock shed 3.6% in after-hours trading.
“AI-driven transformation is changing work, work artifacts, and workflow across every role, function, and business process," said Satya Nadella, chairman and chief executive officer of Microsoft. “We are expanding our opportunity and winning new customers as we help them apply our AI platforms and tools to drive new growth and operating leverage.”
Cloud growth was a standout, with Azure and related services growing by 33%, slightly above consensus estimates.
The quarter also showcased revised reporting for Microsoft’s business segments. Following updates in August, the Productivity and Business Processes unit now includes mobility, security services, and certain Windows revenues, leading to an expanded view of its scale.
The segment reported $28.3 billion in revenue, a 12% rise year-over-year and exceeding market expectations of $27.9 billion.
For added clarity, Microsoft reported Azure revenue without contributions from mobility, security, and Power BI data analytics, giving a cleaner view of cloud demand.
Net income grew to $24.67 billion, up from $22.29 billion in the previous year. So far this year, Microsoft shares have risen by approximately 15%, compared to the Nasdaq’s 25% increase.
Company executives are expected to provide additional insights and future guidance during a call with analysts at 5:30 p.m. ET (8:30 am AEDT).
As at 7:40 am (AEDT), Thursday, October 31, Microsoft Corp (MSFT) stock was trading at $437.14, showing a slight increase of 0.9% from Wednesday's close of $432.53. The stock reached a day low of $408.17 and a day high of $438.5. Microsoft's market cap stands at $3.22 trillion.