Microsoft beats revenue forecasts on cloud computing growth
Microsoft posted a rise in revenue for the first quarter as the ongoing shift to home working helped drive up demand for its cloud computing services.
Microsoft reported revenue of $37.2bn (£28.5bn) for the three months to the end of September, up 12 per cent on the same period last year and ahead of analysts’ forecasts. Operating profit jumped by a quarter over the period to $15.9bn.
Shares in Microsoft were flat in after-hours trading.
The tech firm said it had benefited from increased demand for its cloud services amid a shift in home working.
Microsoft said revenue in its intelligent cloud division jumped 20 per cent to $13bn over the quarter, with 48 per cent growth in its Azure service.
Legacy tech firms such as Microsoft have increasingly shifted their focus to cloud computing amid pressure from younger rivals such as Amazon and Google.
Earlier this month IBM announced plans to spin off its IT infrastructure business as it doubles down on its more profitable cloud unit.
Microsoft also reported 11 per cent growth in its productivity and business processes division as revenue from its Office commercial products and cloud services rose.
The company’s personal computing division, which includes Windows software and Xbox products, grew six per cent.
“The next decade of economic performance for every business will be defined by the speed of their digital transformation,” said Microsoft chief executive Satya Nadella.
“We are innovating across our full modern tech stack to help our customers in every industry improve time to value, increase agility, and reduce costs.”