Microsoft Q3 FY2016 earnings: $3.8bn net income on $20.5bn revenue

Microsoft has published its latest financial results, covering the third quarter of its 2016 fiscal year (Q3 FY2016). The company reported net income of $3.8 billion GAAP ($5.0 billion non-GAAP) for the quarter ending March 31, on revenue of $20.5 billion GAAP ($22.1 billion non-GAAP).

That compares with net income of $5.0 billion GAAP ($5.1 billion non-GAAP) on revenue of $21.7 billion GAAP/non-GAAP) during the same quarter a year ago.

Revenue in the company's Productivity and Business Processes division grew by 1% (up 6% in constant currency) to $6.5 billion.

Revenue for Office products and cloud services for commercial customers rose 7% in constant currency, thanks to Office 365 revenue growth of 63%. For consumers, Office revenues increased by 6% in constant currency; the number of Office 365 consumer subscriptions rose to 22.2 milion.

Intelligent Cloud increased 3% (8% in constant currency) to $6.1 billion, with Server products and cloud services rising by 5%. Azure revenue grew by a whopping 120%, as Microsoft reported that Azure compute and Azure SQL database usage more than doubled year-over-year.

It was a bit of a mixed bag for the More Personal Computing group, which saw revenue increase by 1% (3% in constant currency) to $9.5 billion. Revenue from Windows OEMs fell by 2% in constant currency, but Surface revenue rose by a remarkable 61% to $1.1 billion, "driven by Surface Pro 4 and Surface Book".

However, there was more bad news for Microsoft's phone division, as revenue fell by $662 million or 47%, amid further pitiful sales for its Lumia range. And while Xbox Live monthly active users grew 26% year-over-year to 46 million, they actually fell by two million compared with last quarter, when Microsoft boasted "a record of 48 million" users.

Source: Microsoft

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