Microsoft Corporation (MSFT) Q1 2018 Earnings Top Expectations

Microsoft Corporation (MSFT) Q1 2018 Earnings Top Expectations

Microsoft Corporation (MSFT) Q1 2018 Earnings Top Expectations

Shares rose 2.6% to $80.74 in after-hours trading after results beat expectations.

Microsoft Corporation (NASDAQ:MSFT) FQ1 2018 earnings were released after closing bell tonight, and the company posted earnings of 84 cents per share, a 17% increase from last year, on $24.5 billion in sales, a 12% year-over-year increase. In the previous quarter, Microsoft said its run rate exceeded $18.9 billion and that Azure revenue growth was 97 percent.

In the quarter, Microsoft spent $2.7 billion in capital expenses, with much of that money going toward its data-center expansion.

Under Chief Executive Satya Nadella, Microsoft's cloud business - which includes products such as Office 365, Dynamic 365 and the flagship Azure computing platform - has emerged as a major source of growth.

Microsoft ended the quarter with 28 million Office 365 consumer subscribers, up from 27 million from the previous quarter.

Under Satya Nadella, Microsoft has been transforming itself and focusing more on cloud-based services as PC shipments continue to drop. LinkedIn revenues amounted to $1.1 billion. The KeyBanc analysts had expected $1.64 billion in gaming revenue, which would have been down 13 percent.

Microsoft Corp.'s push into the cloud forged ahead last quarter, with demand for online versions of Office productivity software and the Azure web-services business bolstering sales and earnings.

More Personal Computing: This segment, which includes results for Windows licensing and devices (Surface, phones, and Xbox), was flat at $9.4 billion.

MPC (more personal computing) segment derives the majority of its revenues from the PC (personal computing) market.

LinkedIn reported revenue of $1.1 billion in the previous quarter and it once again came in at exactly the same number. In advertising, Microsoft reported a 15 percent revenue increase - excluding traffic acquisition costs - which the report says is driven by higher revenue per search and search volume. The 12% increase (11% in CC) can be attributed to sales of the Surface Laptop.

Surface revenue finally saw some growth, as it had been declining for a while due to the lack of new hardware.

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