Office, Cloud Lead Microsoft Q1 Revenue


Microsoft has revealed its FY20 Q1 financial results, and both the numbers show what we already know. That the Office productivity suite and the Azure cloud platform have become the main engines powering the growth for the company.

The earnings for the first quarter of fiscal year 2020 saw Microsoft post strong growth with $33.1 billion in revenue, a notable 14% increase over the first quarter last year. Net income saw a boost of 21% to reach $10.7 billion.

A breakdown of that previous number reveals $11.1 billion in Productivity and Business Processes, $10.8 billion in Intelligent Cloud, and $11.1 billion in More Personal Computing.

Unsurprisingly, the two main areas of the company’s business, Office and cloud, had a major contribution its strong quarter. CEO Satya Nadella highlighted how more and more large companies are choosing its cloud products to build their digital capability.

The Productivity and Business Processes unit is the one includes Office, and it witnessed a solid growth of 13%, with Office 365 Commercial revenue itself seeing a 25% increase.

Consumers numbers for Office are on the up too, with the suite of productivity applications now counting no less than 35.6 million people as subscribers.

A word about the Intelligent Cloud unit, before we move to Windows.

This arm also performed strong, reaching $10.7 billion in revenue, which makes up for an increase of some 27% year-over-year. Server products and cloud services revenue saw a 30% uptick, while the Azure platform alone was up 59%.

So then, Windows.

Microsoft reports Windows OEM revenue increasing by 9%, but the Surface business dropped 4%.

That has got a lot to do with the fact that the technology titan did not launch any new Surface models during the quarter. But with new devices making their way to the market, we should have some good numbers to report here as well in the next quarter.

Same goes for Windows revenue overall, which Redmond expects to grow in this current quarter, as we approach the end of support deadline for Windows 7 early next year.

Enterprises are projected to purchase new hardware and upgrade to Windows 10 in the coming months.


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