Microsoft earnings: 84 cents a share vs 72 cents EPS expected

Investor Eyes On Microsoft Corp. Stock Today as More Good Cloud News Seen

Meanwhile, revenues from Intelligent Cloud, the company's unit that includes its Azure cloud computing service, was up 14% from the year ago-period to $6.9 billion. In the just-completed quarter, that business met and exceeded the company's goal of $20 billion in annualized revenue. As usual, things like Surface, Office 365, cloud services like Azure, and Windows all saw growth.

Overall, Microsoft reported first quarter net income of $6.6 billion, or 84 cents a share, on revenue of $24.5 billion, up 12 percent from a year ago. At the same time, as new data centers come online and become more efficient, Microsoft has been making progress in increasing the profitability of these services, with commercial cloud gross margin widening to 57 percent. This report is for the first quarter of its 2018 fiscal year, or the third quarter of the 2017 calendar year. Microsoft said earlier this month that Bank of America will use both Azure and Office 365 as it shifts more of its operations to the cloud. "Our results reflect accelerating innovation and increased usage and engagement across our businesses as customers continue to choose Microsoft to help them transform".

In Productivity and Business Processes, the 28% revenue increase (28% in constant currency) was driven by LinkedIn and Office 365.

Microsoft reported revenue of $24.5 billion for the quarter, up almost 12 percent over the same period previous year. The rise in subscription sales for Azure and for corporate and consumer versions of Office 365 also provides more stable and recurring revenue.

Revenue from Microsoft's personal computing division, its largest by revenue, fell 0.2 percent to $9.38 billion but handily beat analysts' estimate of $8.81 billion. Gaming revenue, however, only increased 1 percent, even as Xbox software and services revenue was up 21 percent.

Windows OEM revenue was also up 4 percent and search advertising revenue increased 15 percent.

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