What's New in Microsoft Quarterly Results
Today, the giant Microsoft revealed the financial results of work in the second fiscal quarter - and there really is something to see.
The amount of data is over the top, therefore, we will try to systematize the information received and concentrate on the most important.
In general, the actual results of Microsoft's work were in line with analysts' expectations : $ 26.5 billion in revenue and $ 0.71 profit per share. And although the company's revenue decreased slightly (2%) compared with the same period a year ago - firstly, it was expected, and secondly, the company's fiscal report this year was affected by the purchase of the “telephone department”, which so far only “ eats up the company's funds and makes no profit, and does not exist at 0.
The company's shares right now fell by more than 9%, which may be due to slightly unfulfilled expectations of investors, profit taking and news from Microsoft itself that the company expects soft growth of 4-5% during this fi rocky year. The numbers, to put it mildly, are not the most impressive.
Where will this lame growth come from and what causes it? Microsoft writes about the problems associated with the translation of foreign currency and exchange rate differences, as well as deteriorating macro indicators in emerging and developed markets, including Japan. If we put on this recent rejection of XP support, we get a picture of slow growth.
So the quarter was a failure? Not at all. And that's why.
For all Microsoft hardware developments, the past quarter was generally the best in history: Surface set a profit record, and Lumia Windows Phone broke the supply record. Compared to the previous quarter, revenue from the sale of phones decreased from $ 2.6 billion to $ 2.3 billion. Surface showed an increase in absolute numbers from $ 900 million last year to $ 1.1 billion this year.
The Xbox division sold 6.6 million consoles, slightly less than the same quarter of last year, without saying how many new Xbox One were handed over to customers. However, according to Microsoft, the Xbox One was the best-selling console in the United States during the holidays.
Clouds and Services
Office 365 acquired 2.2 million new subscribers, which, in total, are now 9.2 million. Simple math suggests that 9.2 million x $ 10 per month x 12 months generates $ 1.1 billion in revenue for Microsoft, which is not so bad.
The commercial cloud has earned $ 5.5 billion, an increase of $ 1.1 billion over the past two quarters. Together with the previous figure, it turns out, rather big $ 7 billion for clouds and services.
In the same section, we can mention the growth of Bing's advertising revenue by 23% compared with the same quarter a year ago.
The operating system was perhaps the most difficult quarter, primarily because in the same period a year passed, Microsoft was distributing buns and gingerbread cookies. In the same Windows XP is no longer supported, and revenue from Windows 8 has finally become a net profit.
Microsoft writes that currently more than 2 million people are testing Windows 10, rising from 1.7 million 5 days ago.
Asked by an analyst about how cheaper or completely free (OEM) versions of Windows will be monetized in the future, Microsoft CEO Satya Nadela explained that the company hopes for a mix of services and sales: Windows Store, Bing, Xbox Live and others.
Microsoft also states that it is intentionally ready to license its own operating system at low prices for low-cost devices in order to increase market share.
More devices with different versions of Windows on board mean that more devices will be upgraded to Windows 10 for free.
Microsoft also notes that the strengthening dollar factor will play an important role in the next two quarters of the fiscal year, which may affect the selling prices of services and products for consumers in different countries.
In general, despite the good results, stagnation is not the favorite word on Wall Street. Therefore, the company will have to strain this year in order to meet the indicators that investors expect. But with the existing foundation for Microsoft, this should not be a particular problem.