Microsoft today published its financial results from the third quarter of its 2018 fiscal year, or the first quarter of the 2018 calendar year.
The company reported $26.8 billion in revenue, a 16% growth (14% in constant currency) over the same quarter last year. Operating income grew by 23% (20% CC) to $8.3 billion, and net income grew by 35% (31% CC) to $7.4 billion. Diluted earnings per share comes out to $0.95, a 36% (31% CC) increase from the same quarter last year.
LinkedIn is continuing to grow, still showing a $246 million loss, although there's $133 million income excluding amortization and intangible assets. Overall, LinkedIn revenue grew by 37% (33% CC).
Office commercial products and cloud services revenue grew by 14% (12% CC), and Office 365 commercial revenue grew by 42% (40% CC). In fact, Microsoft says that Office 365 commercial seats grew by 28%. Office commercial products, on its own, declined by 15% (16% CC), and Microsoft says that this is because more businesses are moving to the cloud. The total amount of Office 365 commercial monthly active users (not paid subscribers, for some reason) is over 135 million.
There are now 30.6 million Office 365 consumer subscribers, with Office consumer products and cloud services revenue growing by 12% (9% CC). Overall, Productivity and Business Processes accounted for $9 billion in revenue, a 17% (14% CC) increase year-over-year.
Intelligent Cloud made $7.9 billion in revenue, also a 17% (15% CC) growth from last year. Azure is once again the superstar from this section, growing by 93% (89% CC) YoY. Server products and cloud services grew 20% (17% CC), and server products alone grew by 3% (1% CC). Enterprise Mobility grew 55% YoY, and that's now over 65 million, possibly due to the firm's Microsoft 365 offerings.
Finally, More Personal Computing accounted for $9.9 billion in revenue, a 13% (11% CC) increase YoY. Microsoft says that this was driven by growth in Windows, gaming, Surface, and search.
Windows OEM revenue grew by 4% (4% CC), and accounting for that is an 11% (11% CC) increase in Pro revenue, and an 8% (8% CC) decline in non-Pro revenue. Windows commercial products and cloud services increased by 21% (17% CC), and that's from a greater volume of products that "carry higher in-quarter revenue recognition".
Hardware did pretty well too, with Surface growing by 32% (27% CC) YoY; however, Microsoft isn't boasting large numbers for this quarter. Instead, it's only saying that last year was low due to product end-of-life. After all, it was the quarter before Microsoft refreshed the Surface Pro and launched the Surface Laptop.
Gaming increased by 18% (16% CC), and that's due mainly to Xbox software and services growth of 24% (21% CC). Xbox Live monthly active users grew 13% YoY to 59 million, which is around where it was last quarter. Finally, search revenue grew by 16% (14% CC), excluding traffic acquisition costs.
Microsoft's next earnings report will be on July 19, and it will also have an end-of-year report.