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Microsoft’s first quarter results, announced Thursday, was a mixture of successes and failures with the tech titan reporting a 12 percent revenue drop from 2014.
Revenue slipped to $20.4 billion although profit was up two percent to $4.62 billion, or 57 cents per share, an increase from $4.54 billion and 54 cents per share in the year-ago quarter.
Despite some decreases, the tech firm still exceeded analysts expectations, pushing its stock price up more than six percent in after hours trading.
“We are making strong progress across each of our three ambitions by delivering innovation people love,” CEO Satya Nadella said. “Customer excitement for new devices, Windows 10, Office 365 and Azure is increasing as we bring together the best Microsoft experiences to empower people to achieve more.”
The cloud was a strong money-maker for Microsoft in the quarter, helping to make up for the large decline in the company’s hardware and personal computing division. The firm’s business division, which includes its popular Office software, was also down slightly — but that was due to currency exchange rates.
Cloud revenue was up eight percent (14 percent in constant currency) to $5.9 billion. Server products and cloud services revenue increased 13 percent in constant currency, with revenue from premium products and services growing double-digits. Azure revenue and compute usage more than doubled year-over-year as did Enterprise Mobility customers with an installed base increase of nearly six times year-over-year.
Revenue in Micorsoft’s business division declined three percent (up four percent in constant currency) to $6.3 billion. Office commercial products and cloud services revenue were up five percent in constant currency while Office 365 enjoyed revenue growth of nearly 70 percent and continued user growth across productivity offerings. Office 365 consumer subscribers increased to 18.2 million, with roughly three million new subscribers added in the quarter.
Hardware revenue decreased 17 percent (down 13 percent in constant currency) to $9.4 billion. Windows OEM revenue declined six percent, but still performed better than the overall PC market. Phone revenue was the big problem, however, plummeting 54 percent in constant currency.
Still, Microsoft remains optimistic.
“We’re seeing great traction with businesses who want to bring Microsoft’s cloud, mobile device management technology and data analytics together to improve security and productivity resulting in almost 70 percent year-over-year growth in our commercial cloud run rate,” chief operating officer Kevin Turner said.
The company is projecting a second quarter much the same as the first.
Jennifer Cowan is the Managing Editor for SiteProNews.
The post Microsoft Sees Surge in Cloud Revenue, Dip in Hardware appeared first on SiteProNews.