Microsoft’s commercial cloud computing revenue reached $22.1 billion in the second quarter of the US giant’s fiscal year 2022, figures up 32% year-on-year, allowing the firm of Redmond to refine its results. The tech giant’s overall revenue at the end of this quarter amounted to $51.7 billion, up 20% year-on-year, while its net profit rose to $18.8 billion. , up 21% compared to the second quarter of 2021.
This is a fine performance, which goes well beyond market forecasts. They were counting on revenues of around $50.9 billion for Microsoft’s second fiscal quarter. It is also the first time that the American giant has exceeded the 50 billion dollar mark in a quarter, argues the group’s management in its report on the results of its quarter ended January 25, 2022.
The company performed well across all of its product groups. Office commercial products and cloud services increased 14%, with Office 365 commercial revenue increasing 19%. LinkedIn revenue increased by 37%. Dynamics cloud products and services grew 29%, while Dynamics 365 revenue grew 45%.
Microsoft in the green
Windows OEM revenue rose 25%, despite continued PC component shortages, largely due to strong enterprise demand, with commercial licenses bringing in more money than non-commercial licenses. Windows hardware manufacturing revenue growth also includes the positive impact of deferred Windows 11 revenue.
Even the Surface business grew 8% this quarter, despite Microsoft’s top management predictions that the Surface business would have a tough second quarter. Its growth is largely attributable to sales of Surface laptops, said the management of the American giant.
Microsoft management attributes the strong results to growth in the “number of larger, longer-term Azure contracts” as contributing to strong commercial bookings (up 32% from a year earlier). However, Microsoft Cloud’s gross margin declined slightly year-over-year from 71% to 70%, due to a change in Microsoft’s accounting estimate of the useful life of servers and network equipment.
Azure and the group’s other cloud services grew by 46% in the second quarter, down from recent quarters when growth was 50% or more, which some attribute to the stock price plunge Microsoft after hours.
Source: ZDNet.com