Microsoft’s profit beats estimates on gains from cloud services

By: |
New Delhi | Published: October 27, 2017 3:21:15 AM

Microsoft Corp reported a better-than-expected quarterly profit on Thursday as demand for its cloud computing services for companies rose and personal computer software business stabilized.

Microsoft, it company microsoft, it giant microsoftShares of the technology giant were up 1.76 percent at .15 in trading after the bell. (Reuters)

Microsoft Corp reported a better-than-expected quarterly profit on Thursday as demand for its cloud computing services for companies rose and personal computer software business stabilized.

Shares of the technology giant were up 1.76 percent at $80.15 in trading after the bell.

Microsoft’s focus on fast-growing cloud applications and platforms is helping it beat slowing demand for personal computers that has hurt sales of Windows – the software that powered the company to the top during the dotcom boom. Under Chief Executive Satya Nadella, Microsoft’s cloud business – which includes products such as Office 365, Dynamic 365 and the flagship Azure computing platform – has emerged as a major growth driver. Revenue from Microsoft’s intelligent cloud business rose nearly 14 percent to $6.92 billion in the first quarter ended Sept. 30. Analysts on average had expected $6.70 billion, according to financial data and analytics firm FactSet.

Revenue from Azure, which competes with Amazon.com Inc’s Amazon Web Services and offerings from Alphabet Inc’s Google, IBM and Oracle Corp, grew 90 percent compared to a 97 percent growth rate in the preceding quarter.

Microsoft said commercial cloud annualized revenue run rate reached $20.4 billion in the quarter.

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. The unit includes Windows software, Xbox gaming consoles, online search advertising and Surface personal computers.

The technology giant’s net income rose to $6.58 billion, or 84 cents per share, in the first quarter ended Sept. 30, from $5.67 billion, or 72 cents per share, a year earlier.

Revenue rose 12 percent to $24.54 billion. Microsoft’s shares had risen nearly 27 percent this year through Thursday, eclipsing the 14.4 percent gain in the broader S&P 500.

Get live Stock Prices from BSE and NSE and latest NAV, portfolio of Mutual Funds, calculate your tax by Income Tax Calculator, know market’s Top Gainers, Top Losers & Best Equity Funds. Like us on Facebook and follow us on Twitter.

Next Stories
1Government expects $40 bn in Indian exploration and production in 4-5 years
2Twitter shows signs of life with renewed user growth
3Retail buyers lap up NLC shares, government likely to get Rs 750 cr