Microsoft becomes a trillion dollar company after impressive earnings

Daniel Fowler
April 25, 2019

In the most recent quarter, the company generated $9 billion in revenue from its Commercial Cloud business, which includes the Azure public cloud, commercial subscriptions to the Office 365 productivity software, the Enterprise Mobility and Security products and commercial LinkedIn services.

Microsoft shares have gained 23 percent this year, topping the 17 percent increase in the S&P 500 Index.

At the time of this report, Microsoft stock has climbed $3.00 in after-hours trading.

"Server products and cloud services revenue increased 27 per cent, driven by Azure revenue growth of 73 per cent".

Worldwide public-cloud services sales are expected to grow 17.5 percent this year to $214.3 billion, according to Gartner Inc.

"Microsoft returned $7.4 billion to shareholders in the form of share repurchases and dividends in the third quarter of fiscal year 2019", the biz noted.

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For its third fiscal quarter, which ended on March 31st, Microsoft's Intelligent Cloud division revenue was $9.7 billion, a 22 percent improvement compared to the same quarter past year. Owing to its its diversified business portfolio and ability to deliver timely growth and earnings beats, the tech giant has again endeared itself with both value and growth investors.

Microsoft announced today that it earned a net income of $8.8 billion on revenues of $30.6 billion in the quarter ending March 31.

Azure, Microsoft's flagship cloud product, competes with market leader Amazon Web Services (AWS) to provide computing power to businesses.

Revenue in Intelligent Cloud was $9.7 billion and increased 22 per cent. Hood forecast up to $10.75 billion in revenue for the unit for the fourth quarter.

Commercial cloud revenue rose 41 percent from a year ago to $9.6 billion, which now makes up almost a third of sales, Microsoft said. The unit rose 8 percent to $10.7 billion in the fiscal third quarter. The company is preparing to launch its first diskless console next month as it braces for increasing competition from new forms of gaming, such as a Google's console-free game streaming service due out later this year.

Sales of the company's Surface hardware grew 21 per cent versus 39 per cent the quarter before, also because customers waited for updated hardware they expected to be released soon.

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