Microsoft (MSFT) revenue This fall 2021
Satya Nadella, Chief Executive Officer of Microsoft Corp., listens to audience questions at Microsoft’s annual general meeting in Bellevue, Washington on November 30, 2016.
Jason Redmond | AFP | Getty Images
Microsoft shares fell up to 3% in extended trading on Tuesday after the software and hardware company released fourth quarter results and reported a drop in sales of Windows license sales to device manufacturers.
This is how the company did it:
- Merits: $ 2.17 per share, adjusted, down from $ 1.92 per share analyst expects, Refinitiv said.
- Revenue: According to Refinitiv, $ 46.15 billion versus $ 44.24 billion as analysts expected.
Revenue increased 21% year over year for the quarter ended June 30, according to a statement. In the previous quarter, sales had increased by 19%.
Microsoft’s Intelligent Cloud segment, which includes Azure public cloud, Windows Server, SQL Server, and GitHub, had revenue of $ 17.38 billion, up 30% year over year. Analysts polled by StreetAccount had expected sales of 16.33 billion US dollars.
Azure, which competes with Amazon Web Services, grew 51% revenue for the quarter. Analysts had expected Azure revenue to grow 45.3%, according to a CNBC consensus, while the StreetAccount consensus was 42%. In the previous quarter, Azure revenue grew 50%. Microsoft does not disclose Azure revenue in dollars.
Productivity and Business Processes, which includes Office productivity software alongside LinkedIn and Dynamics, contributed $ 14.69 billion to revenue, up 25% and more than the StreetAccount consensus of $ 13.93 billion. The company’s seat growth for Office 365 commercial subscriptions accelerated from 15% to 17%, with the company leading higher revenue per user and better results with products designed for small businesses and frontline workers.
Microsoft’s More Personal Computing segment, which includes Windows, devices, games, and search advertising, had sales of $ 14.09 billion. That’s up 9% and more than the StreetAccount consensus of $ 13.74 billion.
Technology industry research firm Gartner estimates PC shipments rose 4.6% in the quarter. Microsoft’s revenue from device manufacturers for Windows licenses declined 3% in the quarter, with consumer PC-related license revenue slowing to a 4% decrease from a 44% increase in the previous quarter. The company pointed out delivery bottlenecks that PC manufacturers Dell and HP have pointed out in recent months.
Microsoft-branded Surface PC sales fell 20%, more than the mid-teens decline Microsoft requested in April due to delivery issues.
The coronavirus pandemic has in some ways helped Microsoft’s results and hurt in other ways. The company’s revenue from Xbox content and services, including video game sales, declined 4%, a poor metric compared to 65% growth in the year-ago quarter.
Thanks to a simple comparison with the same quarter of the previous year, the category of server products from Microsoft, which includes the Windows Server operating system and SQL Server database software, achieved sales growth of 16% compared to 3% in the previous quarter due to the weakness of transactions at the time. These conditions also arose because of Covid.
Search advertising revenue increased 53% as the advertising market rebounded. This also benefited the LinkedIn business, which grew 46%. The advertising-related Marketing Solutions business grew 97%, according to Microsoft.
In the fourth quarter of fiscal year Microsoft announced its intention to acquire voice recognition company Nuance Communications for $ 19 billion including debt. It also introduced Windows 11, a new version of its desktop operating system, although selling licenses to device manufacturers is on hold.
The company’s board of directors voted to appoint CEO Satya Nadella as its chairman, and Microsoft’s largest single shareholder, co-founder Bill Gates, announced that it is separating from his wife, Melinda French, who also once worked at Microsoft.
Executives will discuss the results with analysts and issue guidelines in a conference call starting at 5:30 p.m. ET.
Regardless of the off-hours move, Microsoft shares have risen about 29% since early 2021, while the S&P 500 index has risen nearly 17% over the same period.
This is the latest news. Please check again for updates.
WATCH: What this investor is looking for in earnings reports this week