Microsoft Cloud powers fiscal revenue to $198.3 bn

Microsoft reported revenue of $51.9 billion (+12 percent), operating income of $20.5 billion (+8 percent) and net income of $16.7 billion (+2 percent) for the fourth quarter ended June 30, 2022.
Satya Nadella and Microsoft leadershipMicrosoft’s revenue was $198.3 billion (+18 percent), operating income was $83.4 billion (+19 percent) and net income was $72.7 billion (+19 percent) for the fiscal year ended June 30, 2022.

The Redmond, Washington-based Microsoft generated revenue of $16.6 billion (+13 percent) from in Productivity and Business Processes business), with the following business highlights:

Office Commercial products and cloud services revenue increased 9 percent driven by Office 365 Commercial revenue growth of 15 percent

Office Consumer products and cloud services revenue increased 9 percent and Microsoft 365 Consumer subscribers grew to 59.7 million

LinkedIn revenue increased 26 percent

Dynamics products and cloud services revenue increased 19 percent driven by Dynamics 365 revenue growth of 31 percent

Microsoft generated revenue of $20.9 billion (+20 percent) in Intelligent Cloud business, with the following business highlights:

Server products and cloud services revenue increased 22 percent driven by Azure and other cloud services revenue growth of 40 percent

Microsoft generated revenue of $14.4 billion (+2 percent) in More Personal Computing business, with the following business highlights:

Windows OEM revenue decreased 2 percent

Windows Commercial products and cloud services revenue increased 6 percent

Xbox content and services revenue decreased 6 percent

Search and news advertising revenue excluding traffic acquisition costs increased 18 percent

Surface revenue increased 10 percent

Forecast

Microsoft on Tuesday forecast revenue this fiscal year would grow by double digits, driven by demand for cloud computing services.

The outlook shows Microsoft continues to benefit from the pandemic-led shift to hybrid work models and comes at a time when investors are bracing for an economic downturn, with inflation roaring and consumers cutting spending.

“We are seeing larger and longer-term commitments and won a record number of $100 million-plus and $1 billion-plus deals this quarter,” said Microsoft CEO Satya Nadella. “We have more data center regions than any other provider and we will launch 10 regions over the next year.”

Microsoft faces pressure from a stronger greenback as it gets about half of its revenue from outside the United States. That led the company to lower its fourth-quarter profit and revenue forecasts in June.

Softer consumer demand also hit gaming revenue, which fell 7 percent year-on-year due to a drop in Xbox hardware, content and services, the company said. It is expected to fall in the low to mid-single digits this quarter, driven by declines in first-party content.