Microsoft Corporation (NASDAQ:MSFT) topped market expectations as it reported 11% growth in first quarter revenue to $50.1 billion versus estimates of $49.61 billion, together with a 6% rise in operating income to $21.5 billion.
Net income fell 14% to $17.6 billion and diluted EPS declined 13% to $2.35 but this was still above Street forecasts of $2.30.
Amy Hood, executive vice president and CFO of Microsoft said: “We continue to see healthy demand across our commercial businesses including another quarter of solid bookings as we deliver compelling value for customers.”
READ: Microsoft confirms job cuts as it expects growth to slow - CNBC
Revenue in the Intelligent Cloud business reached $20.3 billion, a touch below expectations, with server products and cloud services revenues rising 22% driven by Azure where revenues rose 35% (below forecasts for a 36.4% advance) well below the 50% growth seen in the same quarter last year.
The Productivity and Business Processes arm posted revenues of $16.5 billion (above forecasts of $16.13 billion) boosted by 7% growth in office commercial products and cloud services revenues, with 365 consumer subscribers up to 61.3 million.
LinkedIn revenue increased by 17% and dynamics products and cloud services revenue rose by 15% driven by Dynamics 365 revenue growth of 24%.
Revenue in More Personal Computing were $13.3 billion, a slight decrease, reflecting a 15% revenue fall in Windows OEM although Windows Commercial products saw an 8% revenue rise.
The tech giant said it has returned $9.7 billion to shareholders in the form of share repurchases and dividends in the first quarter of the year, down 11% compared to quarter one 2022.
Contact the author at jeremy@proactiveinvestors.com