Inside the White House with D.C.'s most wired reporter. Sign up for Mike Allen's Axios AM.


Continued cloud growth helps Microsoft again beat expectations

Microsoft CEO Satya Nadella
Microsoft CEO Satya Nadella (Photo: Microsoft)

Buoyed by Azure and Office 365, Microsoft reported sales and earnings ahead of what Wall Street was expecting.

Why it matters: The cloud has been Microsoft's growth engine for the past couple of years even as the PC market has been in decline.

Excluding a large one-time tax-related charge and other items, Microsoft said it earned $7.5 billion, or 96 cents per share, on revenue of $28.9 billion. Analysts were expecting per-share earnings of 86 cents per share, on revenue of about $28.3 billion, according to Zacks.

Other highlights:

  • Revenue in the productivity unit that includes Office was $9 billion, up 25%
  • Revenue in the "intelligent cloud" unit was $7.8 billion, up 15%
  • Revenue in the "more personal computing" unit that includes Windows was 12.2 billion, up 2%
  • LinkedIn accounted for $1.3 billion of Microsoft's revenue
  • LinkedIn had an operating loss of $265 million, wider than a year ago, but less than it had in the prior quarter
  • Search advertising revenue excluding traffic acquisition costs increased 15%
  • Revenue from Microsoft Surface was up 1%
More stories loading.