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Microsoft, exceeds expectations as ‘cloud’ soars

Microsoft reported its Q1 and records nearly $50B in quarterly revenue!

Beating analyst expectations, as continued growth in Microsoft’s cloud business boosted its quarterly revenue to $49.4 billion, (up 18.2%) with profits of $16.7 billion, (up 8%) beating Wall Street’s expectations with earnings per share of $2.22, as reported by Microsoft 

Main highlights from the company’s results for the three months ended March 31

  • Microsoft Cloud revenue reached $23.4 billion, up 32% year-over-year.
  • Growth in the company’s Office business led to a 17% increase in revenue in Microsoft’s Productivity and Business Processes Division, to $15.8 billion.
  • An increase in the Windows Commercial business helped to fuel an 11% increase in revenue in the company’s More Personal Computing division, to $15.5 billion.
  • Revenue from search and news advertising topped $2.9 billion, up 22% year-over-year.
  • LinkedIn revenue was $3.4 billion, up 34% for the quarter.
  • Devices revenue, including the Microsoft Surface hardware business, was up 10% to a total of more than $1.7 billion for the quarter.

Adjusting for the impact of foreign currency exchange rates and the acquisition of Nuance Communications, analysts were expecting the company to post about $2.15 in earnings per share, (compared with the $2.22 that Microsoft reported)

The results come amid a busy week for tech earnings, with Apple, Alphabet and Amazon among the companies reporting their numbers later this week.

Microsoft Q1 Chart

Three Months Ended March 31,    
 ($ in millions, except per share amounts) Revenue Operating Income Net Income Diluted Earnings per Share
2021 As Reported (GAAP) $41,706 $17,048 $15,457 $2.03
Net income tax benefit related to India Supreme Court decision on withholding taxes (620) (0.08)
2021 As Adjusted (non-GAAP) $41,706 $17,048 $14,837 $1.95
2022 As Reported (GAAP) $49,360 $20,364 $16,728 $2.22
Percentage Change Y/Y (GAAP) 18% 19% 8% 9%
Percentage Change Y/Y (non-GAAP) 18% 19% 13% 14%
Percentage Change Y/Y (non-GAAP) Constant Currency 21% 23% 17% 18%