Microsoft FY17 Q3 earnings: $23.6 billion in revenue on back of cloud, Office growth

Microsoft has released its earnings report for FY17 Q3, showing a total of $23.6 billion in revenue (non-GAAP) and $7.1 billion in net income. That's up from the same period a year ago, in which Microsoft brought in $22.1 billion in revenue and $5.0 billion in net income.

Here are some of the highlights from this quarter's release:

• Revenue was $22.1 billion GAAP, and $23.6 billion non-GAAP
• Operating income was $5.6 billion GAAP, and $7.1 billion non-GAAP
• Net income was $4.8 billion GAAP, and $5.7 billion non-GAAP
• Diluted earnings per share was $0.61 GAAP, and $0.73 non-GAAP

As with its previous quarterly earnings, Microsoft points to its Intelligent Cloud business as one of its drivers of growth. Intelligent Cloud revenue was up 11 percent to $6.8 billion thanks largely to a 15 percent increase in cloud services revenue. Office also helped to drive growth, with Office 365 commercial revenue specifically growing 45 percent. Office consumer products and cloud services was also up by 15 percent with the total number of Office 365 consumer subscribers increasing to 26.2 million.

Unfortunately, Microsoft's "More Personal Computing" category, which counts Windows OEM revenue, Surface, gaming and more, paints a different picture. Overall, the category was down 7 percent to $8.8 billion in revenue. Interestingly, the main driver of that decrease was Surface revenue, which fell 26 percent. Every other portion of this category — aside from a $730 million decline in phone revenue — was up. Here's a look at the highlights:

• Windows OEM revenue increased 5% (up 5% in constant currency)
• Windows commercial products and cloud services revenue increased 6% (up 6% in constant currency)
• Surface revenue decreased 26% (down 25% in constant currency)
• Search advertising revenue excluding traffic acquisition costs increased 8% (up 9% in constant currency)
• Gaming revenue increased 4% (up 6% in constant currency)

As usual, Microsoft will hold a conference call and webcast at 2:30 p.m. PT / 5:30 p.m. ET on its investor site to discuss the earnings.