Economy

Microsoft Beats Estimates on Cloud Services, Gaming, and Software Growth

Microsoft Beats Estimates on Cloud Services, Gaming, and Software Growth

The software giant's fiscal fourth-quarter results reported late Thursday were just the latest evidence of its success at moving its business beyond the software typically found on PCs.

For the fourth quarter that ended on June 30, Redmond reported revenue of $30.1bn (around £23bn), up 17 per cent compared to $25.6bn in the year-ago quarter, and net income of $8.9bn.

"Exceptional sales execution delivered double-digit revenue growth across all segments and strong progress against our strategic priorities, anchored by commercial cloud revenue growing 53% year-over-year to $6.9 billion", CFO Amy Hood said in a statement.

Revenue from productivity products (consumer and commercial Office software and cloud services, LinkedIn, Dynamics products) grew 13% to $9.7 billion.

Revenue was up 17% year-over-year to $30.1 billion.

"We're investing aggressively to build Azure as the world's computer", Nadella said, referring to Microsoft's cloud computing platform that competes with services run by Amazon and Google.

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"I predict that Microsoft's cloud market share will continue to grow and impress investors".

Wall Street wasted no time in reacting with Microsoft shares hitting all time highs this morning opening at $108 before settling to about $106 in afternoon trading, a roughly 2% gain for the day.

Revenue from server products and cloud services was up 23% to $9.6 billion (analysts expected $9.09 billion). Surface sales crossed $4.6 billion in FY18, while Windows Pro revenues rose by 14 percent. And More Personal Computing, which includes Windows, the Xbox, and the Surface hardware business, was up 17%, to $10.8 billion. Xbox software and services revenue increased 36 percent, attributed to third-party titles, and Xbox Live monthly active users stand at 57 million, up 8 percent, year on year.

Microsoft has announced technology partnerships with other major firms in recent months including General Electric, Starbucks, Bayer, Spain's Telefonica and sports organisations such as the National Basketball Association and PGA.

Microsoft Office also had a good year with Office 365 commercial revenue growing by 38%.

Analysts were expecting earnings per share of $1.08 on revenue of $29.2 billion for the last quarter of Microsoft's fiscal year.