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Microsoft's latest quarterly financial results show strong performance, particularly from cloud services

A strong quarterly showing from Microsoft as rumors swirl about a potential purchase of EA. (Source: Arquitectonica)
A strong quarterly showing from Microsoft as rumors swirl about a potential purchase of EA. (Source: Arquitectonica)
Microsoft's results for Q2 2017/2018 show favourable increases in revenue and income. Cloud services are the standout performers with Office 365 and Azure as two of the main contributors.

Microsoft has released their second quarter of fiscal-year 2018 financial results — this is for the quarter ended 31st December, based on Microsoft’s split 2017/2018 financial year — and the results are positive overall. Both revenue and income have increased by double-digit percentages, with the strongest individual performing portfolios being commercial sales of Office 365, Dynamics 365, and Microsoft Azure cloud services.

Overall revenue for the quarter was US$28.9 billion, representing an increase of 12% against the same quarter in the previous financial year while operating income increased by 10% to US$8.7 billion. The revenue breakdown of the three main product branches was:

  • More Personal Computing - US$12.2 billion (+2%).

    • Windows OEM sales (+4%)
    • Windows commercial products (-4% due to a large sale during this period last year)
    • Gaming products (+8%, helped by Xbox One X)
    • Search advertising (+15%, increased price per click and increased volume)
    • Surface products (+1%)

  • Productivity and Business Processes - US$9.0 billion (+25%).

    • Commercial office products and cloud services (+10%, although Office 365 commercial was +41%)
    • Consumer office products and cloud services (+12%, helped by consumer Office 365 subscriptions hitting 29.2 million.)
    • Dynamics products and cloud services (+10%, although Dynamics 365 was +67%)
    • LinkedIn

  • Intelligent Cloud - US$7.8 billion (+15%).

    • Server products and cloud services (+18%, although Azure was +98%)
    • Enterprise services (+5%)

Overall a strong showing by Microsoft which reflects the emphasis they have put on growing cloud services over the last few years, particularly in the commercial/business space. This can be seen by separating the revenue figures for commercial cloud services from the rest of the report. Doing this shows a revenue of US$5.3 billion which represents a 56% growth in commercial cloud services. These platforms are becoming more important as more businesses and consumers elect to pay for a small selection of subscription services, rather than buying the software outright.

However, despite the increased revenue and income, Microsoft reported a loss of US$6.3 billion for the quarter due to a one-off charge of US$13.8 billion related to the Tax Cuts and Jobs Act 2017.

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> Notebook / Laptop Reviews and News > News > News Archive > Newsarchive 2018 02 > Microsoft's latest quarterly financial results show strong performance, particularly from cloud services
Craig Ward, 2018-02- 6 (Update: 2018-02- 6)
Craig Ward
Craig Ward - News Editor
I grew up in a family surrounded by technology, starting with my father loading up games for me on a Commodore 64, and later on a 486. In the late 90's and early 00's I started learning how to tinker with Windows, while also playing around with Linux distributions, both of which gave me an interest for learning how to make software do what you want it to do, and modifying settings that aren't normally user accessible. After this I started building my own computers, and tearing laptops apart, which gave me an insight into hardware and how it works in a complete system. Now keeping up with the latest in hardware and software news is a passion of mine.