Microsoft shares are falling in late trading Tuesday after the software giant posted better-than-expected results for its latest quarter. Apparently, Wall Street was expecting an even bigger beat.
For the fiscal fourth quarter ended June 30, Microsoft posted revenue of $46.2 billion, up 21% from a year ago and ahead of analysts’ forecast for $44.1 billion. Profits were $2.17 a share, beating the Wall Street consensus of $1.90 a share.
Microsoft exceeded its own guidance in all three of its operating segments.
Productivity and Business Processes, which includes Office, had revenue of $14.7 billion, up 25%, or 21% in constant currency, ahead of the guidance range of $13.8 billion to $14.05 billion.
Intelligent Cloud revenue, including Azure, was $17.4 billion, up 30%, or 26% in constant currency, beating the guidance range of $16.2 billion to $16.45 billion.
Revenue from the More Personal Computing segment, which includes Windows, Xbox, and Surface, was $14.1 billion, up 9%, or 6% in constant currency, which was above the forecast range of $13.6 billion to $14 billion.
Revenue from Azure, the company’s public cloud business, was up 51% from a year ago, or 45% in constant currency. (The company does not provide a dollar figure for Azure revenue.)
Meanwhile, revenue was up 46% at LinkedIn, down 4% for Xbox content and services, up 53% for search advertising excluding traffic acquisition costs, up 20% for Office commercial products, and up 25% for Office 365. Server products and services were up 34%.
“Our results show that when we execute well and meet customers’ needs in differentiated ways in large and growing markets, we generate growth, as we’ve seen in our commercial cloud—and in new franchises we’ve built, including gaming, security, and LinkedIn, all of which surpassed $10 billion in annual revenue over the past three years,” Microsoft CEO Satya Nadella said in a statement.
CFO Amy Hood added in a statement that the company saw 30% year-over-year growth in commercial bookings, with 36% growth in commercial cloud revenue, to $19.5 billion.
The company repurchased $7.2 billion worth of stock in the quarter.
Microsoft shares are down 2.6% in late trading.
Write to Eric J. Savitz at [email protected]
