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7 things you should know about Microsoft’s Q3 earnings report

— Microsoft missed analyst expectations of 64 cents a share (non-GAAP) in earnings, delivering only 62 cents a share–flat from the year-ago quarter. (See the full results here.) —Sales in the March-ending quarter came to $22.08 billion, up 2% from sales in the year-ago quarter. Analysts expected $22.09 billion in sales. —The cloud services business saw the … Continue reading “7 things you should know about Microsoft’s Q3 earnings report”

— Microsoft missed analyst expectations of 64 cents a share (non-GAAP) in earnings, delivering only 62 cents a share–flat from the year-ago quarter. (See the full results here.)

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Sales in the March-ending quarter came to $22.08 billion, up 2% from sales in the year-ago quarter. Analysts expected $22.09 billion in sales.

The cloud services business saw the biggest sales growth. Revenues in that unit grew 3% to $6.1 billion over the year-ago quarter, highlighted by brisk sales of Azure virtual computing and Windows Server.

Sales from the personal computing business unit grew 1% to $9.5 billion in the quarter.  Windows OEM revenue declined 2% (in constant currency), hurt by a contracting PC market. Surface revenue increased 61% in constant currency, driven by strong sales of the Surface Pro 4 and the Surface Book, Microsoft said. Phone sales declined 46% in constant currency.  Xbox Live monthly active users grew 26% year-over-year to 46 million.

The Productivity and Business Processes business grew just 1% to $6.5 billion in the quarter. Office 365 and Dynamics CRM were big contributors.

–Microsoft said it expects revenue of $22.05 billion for the June-ending quarter–slightly lower than its revenue in the year earlier period. Analysts had expected about $23 billion in the June-ending quarter.

Microsoft shares were trading off 5% in after hours trading as investors reacted to the earnings miss.

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About the author

Fast Company Senior Writer Mark Sullivan covers emerging technology, politics, artificial intelligence, large tech companies, and misinformation. An award-winning San Francisco-based journalist, Sullivan's work has appeared in Wired, Al Jazeera, CNN, ABC News, CNET, and many others.

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