Microsoft reported its earnings for the first fiscal quarter ended September 30, with revenue coming in at $92.3 billion, up 19% from a year earlier. Xbox saw a decline of 2% in the quarter.
The big tech company reported net income was $36.6 billion, or $4.92 a diluted share, in the quarter, up 32% on a GAAP basis and $4.89 on a non-GAAP basis. For the quarter, Wall Street expected earnings per share of $4.27 on revenue of $90.6 billion, according to Bloomberg analyst consensus estimates. That compared to EPS of $4.13 and revenue of $77.6 billion the company saw in the same period last year.
Devices and Consumer includes Microsoft’s search and advertising businesses, Xbox, and Windows OEM and devices. The company said Xbox content and services saw a drop of 2% in the quarter (1% in constant currency compared).
Non-GAAP results exclude the impact from investments in OpenAI. The results come a day after Microsoft offered 60,000 buyouts to employees, about a quarter of its staff. Clearly, AI is having an impact on the company.
“We are delivering greater capability, choice, control, and cost efficiency for customers across our entire stack,” said Satya Nadella, chairman and chief executive officer of Microsoft. “By helping organizations build and own their own intelligence, and earning trust through agent safety and security, we are translating our innovation into growing adoption and real-world impact across every industry.”
“We delivered a strong start to the fiscal year with Microsoft Cloud revenue of $63.9 billion, with growth accelerating to 30% (up 31% in constant currency) year-over-year,” said Amy Hood, executive vice president and chief financial officer of Microsoft. “Results exceeded expectations across revenue, operating income, and earnings per share.”
Revenue in Devices and Consumer was $15.5 billion and decreased 3%, with the following business highlights:
· Search and advertising revenue excluding traffic acquisition costs increased 12%
· XBOX content and services revenue decreased 2% (down 1% in constant currency)
· Windows OEM and Devices revenue decreased 22%