 |
| Microsoft exceeds sales expectations |
Microsoft announced its financial results for the first quarter of 2022, reporting revenue of $45.3 billion and net income of $20.5 billion.
Revenue increased 22 percent, and net income increased 48 percent. The company saw strong revenue performance in its cloud, servers, and Office businesses this quarter.
The company just released Windows 11. However, due to delivery problems in the months prior to this new version of Windows, PC sales in the United States have declined.
However, this does not appear to affect Windows sales. Windows OEM sales rose 10% this quarter, though the company said its PC demand was still affected by supply chain constraints.
Due to the demand for Microsoft 365, sales of commercial Windows products and cloud services also increased by 12%.
In terms of space, the acquisition rate is down 17% this quarter and it doesn't look like acquisitions will increase in the next quarter.
The company's chief financial officer warned that his forecast for the second quarter of this year includes an expected decline in Surface sales.
The Xbox Series X and Xbox Series S game consoles have been around for nearly a year, and sales of their consoles have continued to grow in recent months.
Device sales increased another 166% during the quarter due to continued demand for new platforms.
Microsoft's total gaming revenue rose 16% to nearly $3.6 billion in the quarter, and Xbox set a record in the first quarter. However, Xbox content and services revenue only increased by 2%.
The company said that Xbox Game Pass subscriptions have increased. However, he did not announce the number of new subscribers. The last number announced was 18 million Xbox Game Pass users as of January 2021.
Total cloud revenue increased by 31%
Smart Cloud revenue is growing 31% every year. Including 50% revenue growth from Azure and other cloud services.
Office quarterly performance was also very strong, with sales of Office consumer products and cloud services increasing 10%. The total number of Microsoft 365 subscribers who are consumers increased by 19% to 54.1 million.
Revenues for the professional version of Microsoft Office and related cloud services increased 18% each year. With Office 365, sales increased by 23%.
However, due to the continued move to cloud services, revenue from the Office business is down 13% annually.
While sales of the company's three main activities remained balanced, the smart cloud activity gradually declined.
Productivity and business operations, including Office, LinkedIn, and Dynamics, make up approximately 33% of the company's revenue.
Intelligent cloud, including Auzre, server products and cloud services, now accounts for 38% of Microsoft's revenue.
Personal computing, including Xbox, Windows, and Surface, account for approximately 29% of the company's total revenue.