Microsoft: $20.40 billion in revenue, $5.66 billion in net income for fiscal Q3 2014

Microsoft has announced that for the first calendar quarter of 2014 (which is considered the third quarter of 2014 in Microsoft's fiscal year) the company generated $20.40 billion in revenues, along with $5.66 billion in net income. Both numbers are slightly lower from the same period a year ago, when Microsoft recorded $20.49 billion in revenues and $6.06 billion in net income. However, today's figures were in line with predictions from most financial analysts.

Devices and Consumer revenue grew 12% to $8.30 billion.

  • Windows OEM revenue grew 4%, driven by strong 19% growth in Windows OEM Pro revenue.
  • Office 365 Home now has 4.4 million subscribers, adding nearly 1 million subscribers in just three months.
  • Microsoft sold in 2.0 million Xbox console units, including 1.2 million Xbox One consoles.
  • Surface revenue grew over 50% to approximately $500 million.
  • Bing U.S. search share grew to 18.6% and search advertising revenue grew 38%.

Commercial revenue grew 7% to $12.23 billion.

  • Office 365 revenue grew over 100%, and commercial seats nearly doubled, demonstrating strong enterprise momentum for Microsoft’s cloud productivity solutions.
  • Azure revenue grew over 150%, and the company has announced more than 40 new features that make the Azure platform more attractive to cloud application developers.  
  • Windows volume licensing revenue grew 11%, as business customers continue to make Windows their platform of choice.
  • Lync, SharePoint, and Exchange, our productivity server offerings, collectively grew double-digits.

Microsoft will offer guidance for future earnings as part of its financial conference call with analysts later today at 5:30 pm Eastern time (2:30 pm Pacific time). CEO Satya Nadella is expected to attend the call.

Source: Microsoft | Image via Microsoft

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38 Comments

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Did anyone really expect anything else? Microsoft is a behemoth of a company which provides many excellent services which have very few on a par competitors...
I`d love to see a more precise breakdown of the harware sales as this is where i would like to see MSFT pushing more, they now have the products.

It's probably fake news, writers were paid by M$. They are obviously dying, lots of people here told me that. Gaming on linux and everyone will jump on it screaming " OMG GAMEZ ".

/s

wotsit said,
Half of Apple's - puts things in perspective.

That's comparing apples to oranges (pun intended :p) Apple is a hardware company that sells $300-8000 computers and devices. Microsoft is a software company that sells stuff in the $30-300 price range. Even selling millions of software licenses makes it hard to equal total revenue.

Apple did about $43B and pulled out $9.5B in profits. Let's say about 25%. Microsoft did $5.6B net income on $20.5B revenue which comes out to be about 25% as well so all in all pretty even.

$30/$300? I am afraid that if you want to buy CRM or Financial software from MS you need to add at least one 0. Not to mention servers, SQL etc.

wotsit said,
Half of Apple's - puts things in perspective.

Not really but hey, at least you mentioned Apple and that's what's important, right?

Cosmocronos said,
$30/$300? I am afraid that if you want to buy CRM or Financial software from MS you need to add at least one 0. Not to mention servers, SQL etc.

Apple also sells $20 accessories but that's not the bulk of their sales. SQL Server and CRM stuff (Dynamics) are usually bought as part of a contract of some sort. and are more specialized.

It was a general statement to compare and contrast and to point out that on the whole things are pretty even still. Now if they both sold the same exact things (say selling cars or fruits at a market) and Apple came away with 50% more sales and profits then you could say Apple is doing something right. For now though... it's a wash.

Roger H. said,

Apple also sells $20 accessories but that's not the bulk of their sales. SQL Server and CRM stuff (Dynamics) are usually bought as part of a contract of some sort. and are more specialized.

It was a general statement to compare and contrast and to point out that on the whole things are pretty even still. Now if they both sold the same exact things (say selling cars or fruits at a market) and Apple came away with 50% more sales and profits then you could say Apple is doing something right. For now though... it's a wash.

I am not comparing the two companies profits... Although it is a quite easily discernible fact that the bulk of MS revenues and profits is generated by the Enterprise/Professional segment.... which is actually very good: such segment is much more stable and predictable than the Consumer one.

Roger H. said,

Apple also sells $20 accessories but that's not the bulk of their sales. SQL Server and CRM stuff (Dynamics) are usually bought as part of a contract of some sort. and are more specialized.

It was a general statement to compare and contrast and to point out that on the whole things are pretty even still. Now if they both sold the same exact things (say selling cars or fruits at a market) and Apple came away with 50% more sales and profits then you could say Apple is doing something right. For now though... it's a wash.

The bulk of Apple's sales are from the iPhone, which are no where near the $8,000 figure you threw out there...

wotsit said,
Half of Apple's - puts things in perspective.

Apple has a complete different business model. their revenue comes from selling high end devices. mostly. and their devices aren't cheap. Microsoft's most revenue is through businesses selling software, provide services. if you ask me Microsoft has better potential than apple because of wider range of products and services they have. its just at consumer side they don't push enough.

benthebear said,

The bulk of Apple's sales are from the iPhone, which are no where near the $8,000 figure you threw out there...

I agree, but thats still a $600-900 device however. Microsoft's bulk sales are in the $30 OEM licensing it sells per copy of windows. Still tho, millions of copies so its not like they aren't making money. Just saying... Perspective.

wotsit said,
Half of Apple's - puts things in perspective.
I think that "half of Apple" so well diversified that if any one (or two) branches break or fail you're still in excellent shape is a perfect place to be.

Apple looses it's one egg and they're dead in the water.

Dot Matrix said,
Damn, that Metro sure killed Microsoft. Obviously, Microsoft is in for it this time. Oh wait...

/S

At least you are willing to admit that windows 8 has low market share, I have bookmarked your comment btw :-p

Dot Matrix said,
Damn, that Metro sure killed Microsoft. Obviously, Microsoft is in for it this time. Oh wait...

/S

You're just feeding the trolls and playing into their hand, man.

Dot Matrix said,
Damn, that Metro sure killed Microsoft. Obviously, Microsoft is in for it this time. Oh wait...

/S

Actually Dot, Metro did kill their credibility. They had no clear direction when Windows 8 first launched. They've been scrambling ever since to make peace. They made millions of long time fans scratch their head and say to themselves, WTF? So in essence it did not totally kill the company in the way you're referring too, but it did kill their image.

The numbers come in lower than a year ago because of the close to $800million EU fine they had to pay. Otherwise I think they'd edge higher though I haven't done the math as I type this so I'm guessing.

Either way, both sides of the business are growing, consumer and enterprise numbers are both up. 50% growth in Surface revenue isn't a bad number either, let alone the fact Windows sales grew even as the PC market still went down (though it seems to be close to bottoming).

@MatthewKeysLive tweeted Microsoft says deal to acquire Nokia Devices and Services expected to close tomorrow. $MSFT

Is there live webcast available?

calimike said,
@MatthewKeysLive tweeted Microsoft says deal to acquire Nokia Devices and Services expected to close tomorrow. $MSFT

Is there live webcast available?

I doubt it, but even if there was I don't expect to see anything big, lots of "future talk" and biz speak but that's it.

Great numbers. As we can see here, Microsoft is so successful in other parts of the business that they can make astrocious decisions like Windows 8 and still be successful. They can have lackluster sales in the phone and tablet market and still laugh all the way to the bank. This is a mighty company and let's hope they can continue this success while leaving the past, in the past.

Microsoft isn't going anywhere, and that's a great thing. I saw so much cool stuff come out of Build this, that it made WWDC seem like a funeral to me.

McKay said,
Microsoft is dying!

/s


Well, profits and revenues are irrelevant compared to stock prices. Or that's what it seems like. Investors confuse me.

Max Norris said,

Comes up in just about every Windows 8, Windows Phone, X1 or Surface RT thread.
I don't necessarily think people believe that Microsoft is dying. They just made a big boo boo with Windows 8. All companies make boo boos. Looking at the numbers above, they have enough products to keep them afloat for a long time.

JHBrown said,
I don't necessarily think people believe that Microsoft is dying. They just made a big boo boo with Windows 8. All companies make boo boos. Looking at the numbers above, they have enough products to keep them afloat for a long time.

Lots of people think Microsoft is dying. All because Windows Phone and Windows 8 have low market share, and the death of Windows XP.

Dot Matrix said,
Lots of people think Microsoft is dying. All because Windows Phone and Windows 8 have low market share, and the death of Windows XP.

Don't forget Sony fans who are celebrating the PS4's sales while the rest of the company is actually dying a slow death. Some people just have no idea of the whole picture.

dr_crabman said,

Don't forget Sony fans who are celebrating the PS4's sales while the rest of the company is actually dying a slow death. Some people just have no idea of the whole picture.

People can fail to see what the company does outside of the target area that they are fans of. I know most fans of the Samsung Galaxy phones are aware they make TV's too, but so many don't seem to know they make kitchen utilities too, processors and screens for Apple. Heck until recently I had no idea Samsung made Hospital Equipment, and heavy industry machinery for construction.

JHBrown said,
See, there's the problem. I'm an older fella and I'll stick to the traditional dictionary. :-) :-)
English is made up of words commonly used by society, and Urban Dictionary is a fantastic way to keep up with that. Maybe cereal isn't in the actual dictionary for that purpose at the moment, but it's definitely commonly used/understood by society as such. Would you take Shakespeare's words literally when he wrote them? He first introduced usages of words that are commonly used today.