The earnings report for FY18 Q1 shows a total of $24.5 billion in revenue and $6.6 billion in net income. That's up from the same period a year ago, during which Microsoft brought in $21.9 billion in revenue and $5.7 billion in net income.
Here are the highlights from this quarter's release:
- Revenue was $24.5 billion and increased 12%
- Operating income was $7.7 billion and increased 15%
- Net income was $6.6 billion and increased 16%
- Diluted earnings per share was $0.84 and increased 17%
Microsoft beat analyst expectations, which predicted $23.56 billion in revenues. That's in large part to the continued growth of Microsoft's cloud business. Intelligent Cloud revenues in particular were up 14 percent to $6.9 billion, driven by a 17 percent increase in server products and cloud services, along with Azure revenue growth of 90 percent. Office products were also a highlight of the quarter, with commercial Office and consumer Office revenues up by 10 percent and 12 percent, respectively. LinkedIn revenue came in at $1.1 billion.
Revenue in Microsoft's "More Personal Computing" category, made up of Windows OEM revenue, Surface, gaming and more, was relatively static at $9.4 billion. Most interestingly, Surface revenue was up by 12 percent, an increase Microsoft pins on sales of the new Surface Laptop. Gaming revenue was also up slightly, increasing by one percent due to 21 percent Xbox software and services revenue growth, but lower hardware revenue. Here's a look at the highlights:
- Windows OEM revenue increased 4% (up 4% in constant currency), ahead of the overall PC market
- Windows commercial products and cloud services revenue increased 7% (up 6% in constant currency) driven by annuity revenue growth
- Search advertising revenue excluding traffic acquisition costs increased 15% (up 15% in constant currency) driven by higher revenue per search and search volume
- Surface revenue increased 12% (up 11% in constant currency) driven by sales of the new Surface Laptop
- Gaming revenue increased 1% (0% in constant currency) with Xbox software and services revenue growth of 21% (up 20% in constant currency) offset by lower hardware revenue
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.
We may earn a commission for purchases using our links. Learn more.

Halo: MCC's live service elements make it better, not worse
Halo: The Master Chief Collection is more popular than ever, but some fans don't agree with the live service approach 343 Industries has taken with it. Here's why those elements are, at the end of the day, great for the game and for Halo overall.

Microsoft's Surface Duo is not 'failing up'
Microsoft announced this week that it was expanding Surface Duo availability to nine new commercial markets. While Surface Duo is undoubtedly a work in progress, this is not a sign of a disaster. It's also doesn't mean that Surface Duo is selling a ton either. Instead, the reason for the expansion is a lot more straightforward.

Here's what you can do if Windows 10 update KB5001330 is causing issues
In this guide, we'll show you the steps to get rid of the update KB5001330 to fix profile, gaming, and BSoD problems with the Windows 10 October 2020 Update and May 2020 Update.

The best pre-built desktop gaming PCs for playing Valheim
We've rounded up some of the best pre-built gaming desktop PCs you can buy for playing Valheim. Because it's not a demanding PC game, you don't need to go all-out with crazy specifications and can bag a solid deal if you're on a tighter budget.