Microsoft reports 10.1 percent fall in quarterly revenue

Microsoft began rolling out its Windows 10 previous year, aiming to revive the tech giant’s fortunes, with the new operating system that aims to be seamless across traditional computers and mobile devices such as tablets and smartphones.

In fact, sales figures for Microsoft’s flagging smartphone brand are down by more than half compared to this time a year ago. In total, as of now, there are 20.6 million subscribers to Office 365, the cloud version of its productivity applications, up from 9.2 million a year earlier, which is definitely a substantial increase considering all factors that are involved and does look a lot promising. Search advertising revenue overall grew 21 percent on a constant currency basis.

The company’s More Personal Computing revenue shrank 5% (2% in constant currency) to $12.7 billion.

Microsoft’s net income fell to $5 billion, in its second-quarter ended December 31 from $5.86 billion a year earlier.

Phone revenue declined 49 percent. Adjusted earnings amounted to 78 cents a share, while analysts polled by FactSet had expected adjusted earnings of 71 cents a share.

Shares rose 5.5 per cent to $US54.91 a share in after-hours trading.

Like everyone, Microsoft was keen to highlight fast-growing “commercial cloud” computing sales, which it claims are now running at an annualised rate of $9.4bn. Surface revenue climbed 29% in constant currency on the back of strong launches of the Surface Pro 4 and Surface Book. The Intelligent Cloud business grew five per cent thanks to its component successes; server and cloud services, Azure revenue and Enterprise Mobility Services.

Azure revenue skyrocketed 140% in constant currency, with revenue from Azure premium services tripling from one year prior. Sales to Windows computer OEMS declined by 5%. Cloud-services revenue rose 5% to $6.3 billion for the period.

Microsoft Xbox Live users grew 30% this year, to over 48 million users.

“Businesses everywhere are using the Microsoft Cloud as their digital platform to drive their ambitious transformation agendas”, Satya Nadella, Microsoft’s CEO said in a statement.

Microsoft just released its earnings report for the last quarter, and the major takeaway is that Windows Phone sales were beyond bleak, while Surface revenue performed pretty decently.