Microsoft topped Wall Street expectations again in the second quarter of its fiscal year, as the cloud continues to drive strong financials for the company.
The Redmond, Wash. tech giant reported earnings of 96 cents per share on revenue of $28.9 billion, an increase of 12 percent over this time last year. Analysts expected Microsoft to post earnings of 86 cents per share on $28.39 billion in revenue. Microsoft reported $7.5 billion in non-GAAP profits, a 20 percent increase over last year.
Microsoft stock, which is closing in on the $100 per share mark, is down slightly following the company’s latest financials.
- In the company’s Productivity and Business Processes division, which includes Office 365, revenue rose 25 percent to $9 billion.
- Intelligent Cloud revenue was up 15 percent to $7.8 billion, with Microsoft citing factors including a 98 percent increase in Azure cloud revenue.
- Revenue in the company’s More Personal Computing division, which includes its Windows PC business, Surface products and gaming teams rose 2 percent $12.2 billion for the quarter.
“This quarter’s results speak to the differentiated value we are delivering to customers across our productivity solutions and as the hybrid cloud provider of choice,” Microsoft CEO Satya Nadella, said in a statement. “Our investments in IoT, data, and AI services across cloud and the edge position us to further accelerate growth.”
Microsoft said it took a $13.8 billion net charge related to the recently passed federal Tax Cuts and Jobs Act, mostly related to repatriation of funds from overseas.
Microsoft made a flurry of moves in the last quarter. On the hardware side, it released the second generation of the Surface Book, and later announced plans to expand availability of the devices around the world.
On the gaming side, Microsoft released its latest console, the Xbox One X, which helped juice the bottom line of the More Personal Computing division. It also has been steadily adding to its streaming service Mixer, including a redesigned mobile app. Microsoft also acquired Seattle startup PlayFab, which provides back end technology for game makers.
Microsoft’s digital assistant Cortana is starting to show up in more devices, including its first smart speaker.