Microsoft is a lot more quiet than it used to be on the Xbox front, thanks to Sony’s unassailable position with the PS4, but Xbox Live monthly active users actually grew 26 percent to 46 million over the past three months. Despite revenue at Azure more than doubling, revenue in the division grew just 3 per cent. Surface revenue looked better; it was about $1.1 billion, up 56 percent year-on-year, driven by Surface Pro 4 and Surface Book.
Advertisement
Revenue in Microsoft’s intelligent cloud business, which includes the Azure cloud infrastructure-and-services business as well as products such as non-cloud-related server software, rose 3.3% to $6.1bn in the quarter.
Microsoft has re-iterated its belief in a mythical annual income of $20bn from cloud despite growth in Azure and its apps-as-a-service business slowing.
Microsoft’s channel, one of the largest globally, contain led to expand in its third fiscal quarter as the vendor saw more activity around Office 365 in the SME space.
E5 refers to Microsoft’s Office 365 Enterprise E5, the company’s new corporate plan for Office 365 that increased both the capabilities and the price of the enterprise version. Similarly unadjusted, revenue was $20.5 billion. These predictions seem to have come true for this quarter and they’re likely to hold in the year ahead.Microsoft’s quarterly profit has missed analysts’ estimates as a continued slump in personal computer sales hurt the company’s core Windows business.
“And we continue to innovate in areas that make it easier for our customers, including the recently released preview of Azure Stack, and by bringing SQL Server to Linux”. Office commercial products and cloud services revenue went up 7%.
Overall, Microsoft said its third-quarter net income fell to $3.76 billion, or 47 cents a share, down from $4.99 billion, or 61 cents a share, a year earlier.
On Thursday, the company reported it expects a higher effective tax rate from licensing shifts and revenue deferrals, along with lower-than-expected earnings per share (EPS).
The results showed further declines in Microsoft’s smartphone business, which has failed to gain traction against the market-leaders using Google Android and Apple’s iOS operating system.
But Windows OEM sales dropped 2%. Still, the company said, this quarter’s result outperformed the overall PC market.
Advertisement
However, Phone revenue declined by 46% in constant currency. Search advertising revenue grew by 18% owing to tighter Bing integration with new Windows 10 devices. Microsoft says that the number of “Office 365 commercial seats” grew by 57 percent year over year.
